Malaysia’s Fertile Grounds for AgTech Investments

06/12/2021 10:00 AM
Opinions on topical issues from thought leaders, columnists and editors.

An article by the Malaysia Digital Economy Corporation (MDEC)

Malaysia is currently home to a growingly robust agriculture technology ecosystem that could stand to benefit from increased focus on food security and traceability.

  • MDEC has planted the seeds for a strong AgTech ecosystem, and is driving digital investments into the space via its Digital Investments Future5 (DIF5) Strategy.

  • Chilli farmers under the purview of Pertubuhan Peladang Kawasan Kuala Langat (PPKKL) are now reaping the benefits from their investments into digital agriculture technology (AgTech).

    By adopting Internet of Things (IoT)-enabled fertigation systems, these farmers are benefitting from encouraging outcomes, such as improvement of productivity and income by over 20 per cent, and reduction of operational cost by over 30 per cent – a key catalyst towards Digital AgTech adoption amongst farmers.

    Most importantly, they’re seeing an increase in overall quality of yield of their Grade A chillies by up to 90 per cent, which would directly result in overall improved livelihoods.

    These are the fruits from the seeds planted as part of a pilot project initiated by Malaysia Digital Economy Corporation (MDEC) via a public-private partnership with PPKKL. A collaborative effort under MDEC’s eLadang programme with key stakeholders and ecosystem partners, the project showcases how Digital Adoption can empower and transform the agriculture sector as well as uplift society.

    It is also an indication of Malaysia’s fertile grounds for AgTech investments. Fourth Industrial Revolution (4IR) technology has yet to be widely proliferated and adopted in Malaysian agriculture, but the groundwork of a thriving AgTech ecosystem has now been laid, with technology companies standing to benefit alongside it.

    The Malaysian government is placing great emphasis on the development of Digital AgTech. In the Malaysia Digital Economy Blueprint (MyDIGITAL), agriculture is determined as an industry that will contribute to the growth of the digital economy.

    MDEC, as Malaysia’s lead digital economy agency, is driving the expansion and augmentation of AgTech into the economy. With the recent official announcement as part of the National PEMULIH package with Ministry of Communications and Multimedia under the National Recovery Plan, the eLadang programme is being scaled up to drive the digitalisation and transformation agenda in collaboration with key stakeholders towards catalysing Digital AgTech adoption.

    This isn’t just about accelerating Digital AgTech adoption in the country, but to also foster a vibrant AgTech ecosystem that benefit farmers as well as nurture AgTech innovations and innovators.

    In April 2021, MDEC collaborated with CIMB Islamic Bank Berhad to introduce a micro-financing programme to farmers. With an allocation of RM10 million as an initial funding package, the micro-financing programme enables the farmers to step into the future of digital agriculture utilising Internet of Things (IoT), Big Data Analytics (BDA) and even Artificial Intelligence (AI).

    Future-forward solutions

    More recently, MDEC partnered with Syariah-compliant Peer-to-Peer (P2P) financing platform microLEAP and with Bank Pembangunan Malaysia Berhad (BPMB) to provide RM10 million in Syariah-compliant microfinancing for Malaysia's agriculture community, to catalyse Digital AgTech adoption at scale. This is to further aid the local farming industry in adopting future-forward solutions with support from the funding ecosystem.

    To prepare the next generation of digital farmers, MDEC is working with the public and private institutions through its Premier Digital Tech Universities and Polytechnics, known as Premier Digital Tech Institutions (PDTIs), by embedding industrial and 4IR-related training programmes.

    Additionally, MDEC has enhanced cooperation with global AgTech brands such as Trapview, AgDraft, EarthSense, Trace, AgriWebb, and Soft Robotics in AgTech promotion, investment, training, incorporating 4IR technology and knowledge transfer.

    “The AgTech ecosystem that MDEC is building encompasses a robust talent pipeline, conventional and alternative financial options, and knowledge-sharing from global AgTech players. This not only benefits the agriculture industry by opening the gateway for digital transformation, but also creates fertile grounds that is ripe for AgTech investments.

    “For the Digital AgTech ecosystem to thrive, it requires the involvement of local and foreign players. MDEC understands the challenges faced by investors in emerging technology areas such as AgTech and has taken various strategies to address their concerns and implementing targeted approaches to bring digital AgTech investments into the country,” said Raymond Siva (pic), Senior Vice President, Investment and Brand and Chief Marketing Officer, MDEC.

    AgTech forms one of the five industry sectors identified as key drivers of the digital economy under MDEC’s ‘Digital Investments Future5’ (DIF5) Strategy, which is a five-year plan focusing on five key thrusts aimed at attracting investments and advancing Malaysia’s digital economy following the Twelfth Malaysia Plan (12MP).

    Among other goals, DIF5 targets RM50 billion investments in the digital economy and attracting 50 Fortune500 tech companies to land and expand in Malaysia, in line with the goals set forth by MyDIGITAL.

    For this, MDEC has several initiatives that aid AgTech companies looking to invest in Malaysia. MDEC, together with the Malaysia Investment Development Authority (MIDA) introduced the Digital Investments Office (DIO), a fully digital platform serving as a single window to coordinate and facilitate all digital investments, making it easier and more convenient for investors to submit their investment interest.

    The MSC Malaysia initiative continues to provide incentives and benefits for AgTech companies setting up shop in the country. Additionally, MDEC’s Malaysia Tech Entrepreneur Programme (MTEP) is a pass that allows for foreign tech entrepreneurs and investors to work or invest in the country. Established entrepreneurs and investors can get a one or five-year pass to land and expand in Malaysia.

    “These available opportunities allow Malaysia to foster an innovative AgTech community. Harnessed well, the ecosystem can improve the national agricultural productivity, boost our food security, and help further promote Malaysian agricultural products at international markets. The potential for growth is limitless,” concluded Siva.

    -- BERNAMA

    The Malaysia Digital Economy Corporation (MDEC) is the agency under the Ministry of Communications and Multimedia Malaysia leading the digital transformation of the economy for 25 years. MDEC aims to enable a progressive, innovation-led digital economy.

    MDEC will continue to lead Malaysia’s digital economy forward towards becoming a globally competitive digital nation, anchored on innovation, sustainability, and shared prosperity, firmly establishing Malaysia as the Heart of Digital ASEAN.


    To find out more about MDEC’s Digital Economy initiatives, please visit us at or follow us on: Facebook: Twitter: @mymdec

    (The views expressed in this article are those of the author(s) and do not reflect the official policy or position of BERNAMA)