Economic Analysis of Drone Technology in Agriculture: Insights from Farmer Producer Organisation in Tamil Nadu

Abstract

Indian agriculture makes a substantial contribution to the nation's GDP, employment, and food security. It directly employs over half of the country's workforce, supporting the livelihoods of rural communities. Historically, Indian agriculture has been labour-intensive and reliant on traditional practices, resulting in inefficient resource utilization. To address the numerous challenges facing the Indian agriculture sector, the adoption of emerging technologies, such as drones, is imperative. Drones have the capacity to significantly enhance agricultural practices, increasing productivity, reducing resource wastage and have the environmental advantages of drone technology, such as reduced pesticide usage and minimized runoff, would emphasize its sustainability impact. This study explores the economic dynamics of drone technology in agriculture, addressing a gap in past research amid the growing use of Artificial Intelligence in the sector. Conducted in the paddy cultivation regions of Thanjavur and Madurai districts Farmer Producer Organisations in Tamil Nadu, the study involves a sample of 80 for UAV technology and 120 for conventional methods. The findings reveal significant cost savings and higher profitability with drone-assisted farming, where total expenses decrease from ₹27,723.20 for conventional farming to ₹22,857.50 with drones, primarily due to reduced pesticide and herbicide use and improved application efficiency. While both methods yield similar gross returns of ₹39,100 for conventional and ₹40,640 for drone-assisted—the net returns are markedly higher for drones at ₹17,782.50 versus ₹11,376.80 for conventional practices. Although machine labor costs rise slightly with UAVs, overall savings enhance the financial viability of drone-assisted farming. The economic comparative analysis indicates a net profit increase of ₹7,331, underscoring the economic advantages of adopting drone technology in agriculture.