Farmers should be ‘businessmen’ who respond to market demand, not just grow rice and wheat: NITI Aayog’s Ashok Lahiri

NITI Aayog Vice Chairman Ashok Lahiri on Thursday said India needs to shift agriculture from a production-focused model to a technology-driven, value-added and globally competitive agri-food system.

Speaking at an Indian Chamber of Commerce event on agriculture in Delhi, he said the country has moved beyond food shortages and must now work on raising farm productivity, profitability and access to global markets. Lahiri added that farmers should be seen as "businessmen" who adapt to evolving consumer demand, instead of limiting themselves to traditional crops like rice and wheat.

"With so many people and so little land, we need to rapidly increase productivity in agriculture and provide people in rural areas with employment in non-agricultural sectors," Lahiri said.


He stressed the need for greater adoption of science and technology, noting that productivity per acre for several Indian crops remains significantly below global benchmarks. Modern technologies, including high-yielding hybrid seeds, precision agriculture, improved fertiliser and water management, artificial intelligence, drones, remote sensing and satellite imagery can help raise productivity and reduce input costs, he said.

According to Lahiri, the shift from production to prosperity also requires diversification away from cereals towards higher-value segments such as fruits, vegetables, poultry, fisheries, goat rearing and agroforestry.

He said changing consumer preferences and rising incomes are driving greater demand for milk and dairy products, fresh fruits, eggs, fish, meat and processed food. "Supply needs to adjust to changing demand," he said, adding that farmers must produce what consumers are demanding today rather than what the country lacked decades ago.

Lahiri also flagged the imbalance in fertiliser use in India. The country's average nitrogen-phosphorus-potassium (NPK) ratio is around 9.8:3.7:1, compared with the recommended 4:2:1 ratio, he said. The excessive use of nitrogen, driven partly by differential subsidies that make urea artificially cheap, is degrading soil health and affecting crop productivity, he added. "Correction of this imbalance requires speedy action, but it is stalled by a socio-economic and socio-political logjam," Lahiri said, calling for a solution to the issue.

Focus on global markets
Lahiri further emphasised the need to connect Indian farm produce with global markets. Despite India producing some of the world's best mango varieties, their presence in major international markets remains limited, he said.

"We need to have a much greater presence of our specialised high-value agricultural products on the world stage," he said.

He also called for a shift from raw agricultural produce to value-added products, citing the example of processing pineapple into ready-to-consume products. Such value addition can increase farmers' incomes, create employment and reduce post-harvest losses.

Lahiri said India loses an estimated $18.5 billion annually due to agricultural produce wastage, while post-harvest losses of fruits and vegetables range between 15% and 18% before reaching the market. Greater investment in cold storage and supply-chain logistics is therefore essential, he said.

Boost FPOs
Another priority, according to Lahiri, is strengthening farmer producer organisations (FPOs). Small and marginal farmers often lack the knowledge, capital and market connectivity needed to procure inputs and market their produce efficiently.

"A strong producer organisation can solve many of these problems," he said, arguing that FPOs could help farmers access quality inputs, aggregate produce and improve market linkages.

Lahiri also called for a transition from input-intensive farming to climate-smart and sustainable agriculture. He raised concerns over the possible wastage of groundwater from solar-powered irrigation pumps when the electricity generated is not connected to the grid.

He suggested that solar power systems used for irrigation pumps should be connected to the grid, allowing farmers to sell surplus power and creating an economic incentive to conserve groundwater.

Role of digital technology
Highlighting the role of digital technology, Lahiri said India's digital public infrastructure and Digital Agriculture Mission are laying the foundation for a data-driven, farmer-centric ecosystem. The use of AI, drones, remote sensing, satellite imagery, the Internet of Things and precision agriculture can improve productivity, optimise input use, reduce costs and strengthen climate resilience, he said.

Lahiri said government initiatives, including investments announced in the Union Budget 2026-27, national missions for fruits, vegetables, pulses, coconut and cashew, and programmes supporting food processing, can help build a resilient and future-ready agri-food system.

He also emphasised the importance of implementation and stronger extension services. Fertiliser and pesticide companies, he said, could play a greater role in providing farmers with knowledge about the appropriate use of agricultural inputs, as better extension can also improve business opportunities for companies.