The 65-year-old Tractors and Farm Equipment Ltd. (TAFE) is optimistic about both the domestic and export markets. In an interview, its Chairman and Managing Director, Mallika Srinivasan, shares her thoughts about collaborating with start-ups, interesting consumer trends and impact from U.S. tariffs. Edited excerpts:
TAFE appears to be making a significant bet on the startup ecosystem?
We are working with two startups – eFarmer and xFarm. We have fully acquired eFarmer, a European company manufacturing AutoSteer and Precision AG Solutions. It is now completely integrated with TAFE Advanced AG Solutions (U.K.) and our Advanced R&D Centre of Excellence in Chennai. xFarm is the result of our strategic investment in xFarm, Italy. A dedicated team has developed solutions for contract farming in seed multiplication, commercial crop farming for exporters, and supply chain solutions for food companies. We’ve completed pilots for paddy and cotton seed, maize and potato commercial crops. We look for more opportunities to partner with startups in this space, especially in the alternate energy space.
Can you tell us about your drone services initiative?
We have been running this for over a year now. Right now, it’s small, but we are looking at expanding this. TAFE’s AGAAS (Agriculture as a service) introduced drones for crop monitoring, spraying, and precision application. We want to see if this helps the farmer optimise his input. Does he save on fertilizer, chemicals, and how does this affect his output cost? And that’s what matters to the farmer at the end of the day. And we have had encouraging results. We have already sprayed over 1,00,000 acres of farmland, generating good business growth. These services are complemented by AI-driven crop modelling, satellite imagery, and predictive analytics to improve yields and optimise inputs.
How is the situation in the domestic and international markets?
The domestic industry volume is expected to cross 10 lakh units in the financial year 2026, which is by far the largest in volume anywhere. Overall monsoon picture and other drivers of demand look good. In India, we are expanding into high-growth states with strong product localisation and an enhanced dealer network, ensuring better accessibility and service for farmers. The 4WD (4-wheel drive) segment, in particular, is witnessing rapid growth in eastern states, and we have a solid offering in our DYNATRACK range to meet this emerging demand. Overall, the 4WD tractor market grew by 15.2% in the financial year 2025 and 22.5% in April-June 2025. We are the second largest and dominant player in the Indian market, increasing market share year on year with an annual sale of over 1,80,000 tractors.
We are seeing 10% growth in exports. We expect this growth to be greater than 10% for the next three to four years, while domestically we will see 3-5%. Internationally, we have now moved forward to cater to Europe, one of the most sophisticated small tractor markets in the world. We have established facilities in Turkey and now Mexico.
What consumer trends are you noticing, especially the youngsters?
The tractor decision maker has become younger. And therefore, while they want the reliability, they want the features, they also want the looks, the styling and all of that. This has become a very important change in our industry. Product life cycle will become shorter, because there is an appetite for newer products, newer features, and newer styles. So that is reflective of younger India. The aspirations of rural India are growing leaps and bounds.
What about engine production?
Our partnership with Deutz of Germany is going to be a good growth opportunity that is mutually beneficial. In the domestic market, we sell engines as a genset and for agri applications, and then for a number of other industrial applications like telecom, retail and all of these businesses. That business is also growing well. Our present engine production capacity is 70,000 per annum, and in three years we will be around 1,30,000.
Any challenges that you see in the domestic market?
We are awaiting the announcement of the new emission norms. The industry is ready – we are prepared – we have highlighted whatever concerns we have. That is definitely one challenge for us. Also, the question we have often been asked is, ‘when will you be launching electric tractors in India’. But today it is not cost-effective for the Indian farm. We believe alternate fuels like CNG could pose interesting options, as the network is developing and evolving in the country.
What impact do you see from U.S. tariffs?
We have the technology to cater to the market. On our North America strategy, we will wait and watch for the tariff situation to become clearer.
On working with your daughter?
Lakshmi brings in very fresh perspectives into the organisation. She is very clear about the vision for the future. She embodies the cultural values that have served this organisation very well. She is highly customer-oriented with a strong focus on process and product innovation. She reflects the viewpoint of younger leaders, which will keep the organisation dynamic and vibrant. Blending dynamism, vibrancy with a strong legacy and cultural heritage.
Published – August 24, 2025 07:00 am IST
