Only 4% of $3 bn spend targets sustainable ag

Image by mckaysavage (obtained from: )

By Joe Mathew 

Originally published by Fortune India on the 6th Ocober 2021

India spends $3 billion annually on agricultural innovation but only 4% of that is targeted towards innovations that have explicit environment and social sustainability objectives, a study conducted by consulting firm Dalberg Advisors on behalf of the Commission on Sustainable Agriculture Intensification (CoSAI) has found.

The study, released on October 5, says about 75 per cent of the overall $3 billion is public funding, with Union Ministry of Agriculture & Farmers’ Welfare accounting for more than half of the spending. State governments and other ministries contribute the other 50%. Almost all public investment is directed towards research institutes (50%) or government agencies (50%). Institutional investors contribute $500-600 million and OECD bilateral/multilateral investors about $60 million annually for agriculture innovation targeting adoption of sustainable measures. “Mandating frequent reporting of sustainable agriculture investments by different actors in a format that is transparent, consistent and verifiable would be a first step towards ensuring that we meet our climate and food security goals in parallel,” says Nirat Bhatnagar, Partner, Dalberg Advisors.

Stating that India will face significant challenges in balancing food security needs with environmental and social sustainability outcomes by 2050, the study recommends significantly larger budgets for sustainable agriculture. The underinvested areas include natural resource management (soil health, sustainable water, biodiversity) as well as knowledge management and financing for sustainable agriculture. The clearly defined sustainability outcomes, measured as a combination of environmental, social and human outcomes, are mostly driven through government investments.

The study has called for significant investments in sustainable agriculture systems and urgent switch to more sustainable practices that are good for environment, farming communities and end-users in terms of nutritional outcomes.

India is expected to be home to an estimated 1.6 billion people by 2050 and will need to almost double its food production keeping in mind both the growing population and demand for higher quality food. The study considers this as a key challenge as agriculture is already a major driver of water scarcity, biodiversity loss and carbon emissions in India. "Unless agriculture production methods change substantially with greater emphasis on sustainable agriculture intensification (in terms of environmental impact, human & social impacts), India will not be able to meet its food goals without severe damage to its environment," the study has cautioned.

The case study on India was part of a larger study that covered developing countries like Brazil, India and Kenya.