India Farm Equipment Market Assessment, By Type, By Function, By Distribution Channel, By Region, Opportunities and Forecast, FY2019-FY2033F

India farm equipment market is projected to witness a CAGR of 6.01% during the forecast period FY2026-FY2033, growing from USD 12.09 billion in FY2025 to USD 19.28 billion in FY2033F, due to growing demand for machinery to raise productivity, replace the manpower, and increase efficiency in farming. Government incentives and subsidies promoted the adoption of farm machinery, which has been made more affordable to farmers throughout the country.

Schemes like Sub-mission On Agriculture Mechanization and others offer cash assistance to farmers, prompting them to invest in agriculture inputs. The establishment of custom hiring centers has also helped marginal as well as small farmers own high-priced equipment, contributing to accelerating market growth.

The tractors are the market leaders in plowing, tilling, and towing. They are versatile and can be used with other equipment, making them a must-have for small and large farms. Harvesting machinery, including combining harvesters and reapers, is also increasing at a rapid pace because of the need of reduced labor and the requirement for time-saving solutions. Irrigation units like drip irrigation and solar pumps are also gaining popularity as farmers look for sustainable means of dealing with water scarcity. Some other sub-segments, like soil preparation units, plant protection units, and post-harvest harvesters, are witnessing consistent demand. Region-wise, North India leads the market, with Punjab, Haryana, and Uttar Pradesh states driving demand for heavy HP tractors and advanced machines.

Regionally, North India dominates the market, driven by high mechanization levels, better cultivation conditions, and robust infrastructures. Punjab, Haryana, and Uttar Pradesh states driving demand in North India. Moreover, demand for cotton harvesters and drip irrigation is high in West India, in the states of Maharashtra and Gujarat, owing to the presence of large market players.

For instance, in August 2023, Oxfam India, through Project Utthan, provided sprinkler irrigation systems to 45 farmers in 15 villages in three blocks of Nalanda District. The project was supported by the Pradhan Mantri Sinchai Vikas Yojana and Project Utthan, which drew USD 28,500 from the government's irrigation subsidy scheme.

Governments' Support Bolsters the Demand

Government assistance is increasing the demand for farm equipment and agriculture in India. Schemes and subsidies like PM-Kisan, subsidies on farm machinery, and state-level schemes reduce the cost of equipment for farmers, which was way costlier before financial support was granted. Financial support is offered to buy tractors, irrigation systems, and other equipment. Moreover, schemes facilitating mechanization, such as the Custom Hiring Centers (CHCs), allow marginal and small farmers to avail themselves of sophisticated machinery. Incentives also urge the use of environment-friendly technology, including solar pumps and drip irrigation, from the government. These schemes not only increase productivity but also overcome labor shortages and save on operations. Government support by making farming equipment affordable and available strongly increases demand throughout the farm sector.

For instance, in April 2023, the West Bengal Agriculture Department in Kolkata distributed 13,554 farm equipment and machinery to farmers to improve agricultural production and make labor-saving processes easier. The initiative is part of a campaign to modernize farming practices and benefit small and marginal farmers.

New Product Launches Drive the India Farm Equipment Market

Launches of new products are one of the major growth drivers in the farm equipment industry in India. Players are launching innovative and technologically sophisticated equipment to cater to the changing requirements of farmers. For example, compact tractors, electric tillers, and GPS-equipped machinery are becoming popular as they are efficient and sustainable. Players are also developing low-cost solutions for small and marginal farmers, including mini-tractors and low-cost harvesters. Moreover, the introduction of solar irrigation systems and precision farming equipment is solving problems such as water scarcity and labor shortage. Not only do these new products increase productivity, but they also complement government policies encouraging mechanization and sustainability. By providing customized solutions, manufacturers are stimulating market growth and meeting varied farm needs in India.

For instance, in October 2023, Netafim Limited introduced Toofan with Turbunext Drip Technology, an efficient, long-term, and cost-effective drip irrigation system for farmers of all sizes that aims to maximize irrigation efficiency. The system ensures even water distribution, cuts down on clogging, and keeps maintenance at a minimum, making it perfect for various crops and landscapes.

Tractors Dominate the Market

Tractors dominate the Indian market for farm equipment and hold the greatest share because they are versatile. They are crucial in farming, used in plowing, tilling, hauling, and carrying other machines. Their demand is sustained by government subsidies, shortage of labor, and the necessity of mechanization. Marginal and small farmers favor mini tractors (less than 30 HP), while commercial farming areas such as in Punjab and Haryana opt for high-HP tractors (more than 40 HP). The expansion of custom hiring centers and rental services has also made tractors even more accessible to small farmers. With their multi-purpose usage and supportive policies, tractors continue to be the most sought-after farm equipment in India, due to which companies are launching new-age tractors for markets.

For instance, in September 2023, Mahindra & Mahindra Limited's division Swaraj Tractors introduced a new range of tractors aimed at providing farmers with increased power, reliability, and performance. The tractors come with superior features to enhance efficiency and support varied farming requirements.

North India Dominates the Market

North India dominates the farm equipment market due to the extensive mechanization in the region, coupled with beneficial crop conditions. The states of Punjab, Haryana, and Uttar Pradesh are the prime drivers, being stimulated by vast areas of wheat and rice crop cultivation. It has a high demand for higher-HP tractors (40-120 HP), combining harvesters, being supplemented by government subsidies as well as Sub-mission On Agriculture Mechanization programs. North Indian farmers are early adopters of new technology because they have higher incomes and greater landholdings. Moreover, shortages of labor and a desire for productive farming have spurred mechanization. The infrastructure of the region, such as improved rural roads and availability of funding, also increases the sale of equipment, thus making North India dominate the farm equipment market.

For instance, in June 2024, the Haryana Agricultural University (HAU) came up with a novel paddy threshing machine to mechanize the threshing process for farmers. The thresher aims at labor reduction, time saving, and minimizing grain loss at the time of harvesting.

Future Market Scenario (FY2026 - FY2033F)

The future of the India farm equipment market will be shaped by rapid technological advancements. Precision farming tools will revolutionize the farm equipment industry, enabling real-time data analytics and optimized resource use.

Sustainability will drive the adoption of eco-friendly farm equipment. Solar-powered and electric machinery will gain popularity, supported by government incentives and the need to reduce carbon footprints.

Custom hiring and rental models will expand, making advanced machinery accessible to small and marginal farmers. Custom hiring centers and agri-tech platforms will bridge the affordability gap for high-cost equipment.

Government initiatives will remain a key driver of market growth. Subsidies, schemes like Sub-mission On Agriculture Mechanization, and policies promoting farm equipment loans will encourage investments in mechanization. These efforts aim to address labor shortages, improve agricultural output, and achieve the goal of increasing farmers' income by making modern equipment affordable and accessible.

Key Players Landscape and Outlook

The competitive landscape of the India farm equipment market is characterized by the presence of both established players and emerging companies. Leading manufacturers dominate the tractor segment, leveraging their strong distribution networks and brand reputation. International players like John Deere India Private Limited and CNH Industrial (India) Private Limited are also expanding their footprint, introducing advanced technologies such as precision farming equipment. Smaller regional players and startups are gaining traction by offering affordable and innovative solutions tailored to small and marginal farmers. The market is highly competitive, with companies focusing on product innovation, strategic partnerships, and government collaborations to capture market share. Custom hiring centers and rental models are also emerging as key growth strategies, enhancing accessibility for farmers.

For instance, in August 2024, Mahindra & Mahindra Limited launched a new range of rotavators designed for all crops and soil types, enhancing farming efficiency and versatility. These rotavators aim to improve soil preparation, reduce labor costs, and boost productivity for farmers. This launch reinforces the company's focus on empowering farmers with modern, high-quality machinery to meet diverse agricultural challenges and improve overall farm output.