Image Source: Outlook Business

India requires an estimated $75 billion in investment to help smallholder farmers adapt to climate change, according to Alvaro Lario, President of the International Fund for Agricultural Development (IFAD). With agriculture employing over 42 per cent of India’s workforce and contributing nearly 20 per cent to its GDP, Lario emphasized that safeguarding rural livelihoods from rising climate shocks must be a national priority.

“Small-scale farmers are on the frontlines of climate disruption, yet receive less than one percent of global climate finance,” said Lario during his India visit. “Our goal is to change that narrative by bringing long-term financing, including private capital, into rural areas.”

The IFAD chief identified three pivotal challenges for Indian agriculture: making farming more remunerative, boosting productivity, and transitioning from food to nutrition security. These priorities align closely with IFAD’s current investments in states such as Maharashtra, Meghalaya, Mizoram, and Odisha, where the agency is supporting sustainable practices like crop diversification, water conservation, drought-tolerant seeds, and community seed banks.

Highlighting IFAD’s collaboration with central and state governments, Lario praised initiatives such as the Soil Health Card scheme, which he said helps farmers make more informed decisions on fertiliser use and soil management.

IFAD has invested over $1.5 billion in India over the past 45 years, reaching more than 6 million families, with a strong focus on women, tribal communities, and small-scale producers.

In Meghalaya, the agency is incubating market-driven agri-enterprises offering credit, mentoring, and access to markets. In Mizoram, IFAD promotes integrated farming—linking crops, livestock, and agroforestry through community-led clusters. Weather-based crop planning is also being introduced to help farmers align sowing with rainfall forecasts, reducing their exposure to climatic risks.

Lario also announced that IFAD is mobilising capital by issuing bonds backed by pension funds and central banks, making it the first UN-funded programme to receive dual credit ratings. These instruments are now being used to co-invest directly in agri-enterprises, local financial institutions, and value chains that benefit smallholders.

“Our approach is rooted in inclusive, pro-poor value chains. We’re working to create public-private-producer partnerships that make climate-smart agriculture both viable and profitable,” Lario said.

As India faces intensifying droughts, water scarcity, and extreme weather events, IFAD’s message is clear: climate adaptation in agriculture is not just an environmental necessity—it’s an economic imperative.