As India’s agrochemical exports continue to surge, projected to potentially exceed Rs 80,000 crore in the next four years, the role of agrotech innovation in driving this growth is becoming increasingly critical. A recent knowledge paper by Agro Chem Federation of India and Ernst & Young (ACFI-EY), titled Indian Agrochemical Industry: The Story, the Challenges, the Aspirations, emphasizes the need for government incentives to enhance agrochemical manufacturing and export.
Government Incentives for Advanced Agrotech Solutions
Released at the 7th AGM of the Agro Chem Federation of India (ACFI) yesterday, the report emphasizes the need for government incentives to enhance agrochemical manufacturing and exports through advanced agrotech solutions. Key recommendations include streamlining the registration process for new agrochemical molecules, reducing GST on agrochemicals to 5%, and fostering R&D in biopesticides through technology-driven partnerships. Such measures are seen as essential to positioning India as a global leader in agrotech, ensuring sustainable agricultural growth, and enhancing the livelihood of farmers through advanced agrochemical solutions.
Leveraging Technology to Overcome Industry Challenges
“The USP of India’s agrochemical industry lies in its quality and affordability, making it the first choice for millions of farmers across 130 nations. By creating a conducive environment for technological innovation, the sector has the potential to achieve exports of over Rs 80,000 crore in the next four years,” the knowledge paper stated.
Industry veterans underscored the importance of leveraging technology to overcome current challenges. To foster exports, the government must focus on streamlining licensing norms through digital platforms, improving infrastructure for storage and sale using advanced logistics solutions, and incentivizing biopesticide production via R&D partnerships. The introduction of technology-driven processes in these areas is seen as critical to attracting global investment and enhancing the industry’s competitive edge.
Incentivizing Agrotech Advancements through PLI Schemes
The report also recommended the implementation of a PLI-like scheme specifically designed to incentivize agrotech advancements in the agrochemical sector, projecting an investment boost of Rs 10,000 to Rs 15,000 crore over the next five years. Such initiatives would be pivotal in transforming India into a global manufacturing and export powerhouse for agrochemicals.
Make in India and Agrotech: Transforming Challenges into Opportunities
Parikshit Mundhra, Chairman of ACFI, highlighted the transformative potential of the “Make in India” initiative, particularly when aligned with agrotech innovations.
“The reliance on generic molecules, low agrochemical usage, and a complex registration process for new molecules can be transformed into opportunities through the integration of advanced technology and innovation. This will not only enhance agricultural productivity but also position India as a leader in global agrochemical markets.”
Industry Leaders Advocate for Technological Adoption
The panel discussion titled “Make in India: Transforming Challenges into Opportunities in the Agrochemical Industry” brought together industry leaders who reiterated that technological adoption is key to addressing the sector’s challenges. Speakers emphasized the importance of using technology to streamline the export registration process, enter strategic trade agreements, and enhance domestic production through innovative R&D.
Three Growth Levers for Sustainable Agricultural Growth
The ACFI knowledge paper outlined three key growth levers—improving trade and marketing of agrochemicals, increasing domestic production and R&D through technology, and creating a favourable policy environment. These measures are expected to not only contribute to achieving India’s $5 trillion economy goal but also ensure sustainable agricultural growth, improved food security, and enhanced livelihoods for millions of farmers across the country.
India’s Paradox: Production Capacity vs. Imports
Director General of ACFI, Dr. Kalyan Goswami, set the tone for the discussion by highlighting the pivotal role of India’s agrochemical industry in agricultural success. “As the fourth-largest producer of agrochemicals globally, India faces a paradox: while we hold significant production capacity, we still import a substantial volume of agrochemicals, primarily from China. The ‘Make in India’ initiative, supported by technological innovation, offers a timely framework to transform these challenges into opportunities, enabling India to become a global hub for agrochemical manufacturing and exports.”
ACFI Calls for GST Reduction to Boost Agrotech Adoption
ACFI also called for a reduction in GST on agrochemicals from 18% to 5% at the upcoming 54th GST Council meeting. This reduction, coupled with tech-driven advancements, is expected to significantly boost domestic and global production, contributing to India’s agricultural productivity and ensuring farmers’ well-being and security.
