How Agtech Can Help Break The Poverty Cycle in Developing Countries
Since November 2020, India’s farmers have staged some of the largest protests in the country’s history with tens of thousands of furious farmers camping out on highways outside of New Delhi, writes Prospera Technologies Co-Founder and CTO Raviv Itzhaky at Forbes. The reason behind their frustration and anger? In efforts to level the playing field as part of a global market, the government introduced new laws that dismantled an existing structure by which their crops benefited from a government-agreed minimum price. This is a major issue: 58% of India’s 1.3 billion residents’ livelihood depends on farming, according to CNN.
The World Bank’s 2019 report, “Harvesting Prosperity,” notes that two-thirds of the global population living in extreme poverty earn their livelihood in farming. Because of this, productivity growth in agriculture has the largest impact of any sector on poverty reduction. Of the world’s 736 million people living in extreme poverty, half of the total live in five countries: India, Nigeria, the Democratic Republic of Congo, Ethiopia, and Bangladesh. Crop yields in these countries have barely doubled, even as they tripled in South Asia and increased about six-fold in East Asia thanks to the adoption of new systems and technologies.
One of the biggest changes in agriculture over the past five decades was the shift from resource-led growth to productivity-led growth. This means that instead of focusing on increasing production via expanding on resource availability such as providing food growers with more land or more water, the focus has shifted on increasing yield productivity with existing resources. According to the World Bank’s report cited above, the new metric of success today is the increase in the total factor productivity (TFP), where the efficiency of all inputs are combined to produce better output by using advanced technologies and practices.
Even though studies have consistently proven the link between investment in agricultural R&D and productivity growth, investment in agricultural tech in the regions where it is most needed is either stagnant or falling. While in developed countries, investment in agricultural R&D accounted for 3.25% of the countries’ GDP, the ratio of investment in developing countries was only 0.52%. This widened gap in spend also widens the gap in productivity — and ultimately leaves the poorest countries unable to evolve and feed their population.
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