The Agro Chem Federation of India (ACFI), which represents pesticide manufacturers, urged the government to introduce a targeted, time-bound policy framework for the agrochemical industry. As part of the proposal, ACFI has called for a ₹5,000–7,500 crore support programme to strengthen upstream agrochemical manufacturing. According to ACFI, the proposed programme could help India increase domestic production of agrochemical technicals and intermediates, reduce cost disadvantages compared with China and encourage greater backward integration.
Focus on Domestic Agrochemical Manufacturing
ACFI made the recommendations while releasing a KPMG-prepared knowledge paper titled “Redefining Indian Crop Protection through Innovation: From Scale to Science.” The report argues that India’s industrial policy should focus on addressing specific ecosystem disadvantages that affect manufacturing competitiveness. Rather than creating long-term dependence on subsidies or protection, the proposed measures aim to support investment, production and innovation. The report recommends a 7–8-year support period, including two to three years for plant commissioning followed by sustained production support. It also proposes graded investment thresholds covering both large companies and MSMEs, as well as greenfield and brownfield projects.
Proposed Incentives for Agrochemical Producers
The KPMG report recommends several financial and infrastructure measures to improve the competitiveness of domestic agrochemical manufacturing. These include:
5–8% incentives on incremental sales
30–40% subsidies on industrial electricity costs
Subsidised access to shared Common Effluent Treatment Plants (CETPs)
Capital grants for specialised research and development
PLI-style incentives linked to incremental sales
Long-term financing for manufacturing investments
According to the report, these measures could help address the operating-cost advantage enjoyed by competing manufacturing hubs.
Agrochemical Manufacturing Parks and Infrastructure
ACFI has called for the development of specialised agrochemical manufacturing parks with shared utilities and cluster-based environmental infrastructure. The report also recommends selective backward integration into strategically important intermediates. This approach could strengthen domestic supply chains and reduce dependence on imported raw materials. In addition, ACFI has proposed a single-window regulatory framework supported by a unified digital platform for central and state-level approvals. It has also called for transparent, time-bound processes and clearer regulatory pathways for biological crop-protection products.
Innovation Across Agriculture
Kalyan Goswami, Director General, ACFI, said agricultural innovation needs to bring together multiple technologies rather than develop in isolation. These include biotechnology, crop protection, biologicals, nanotechnology, digital technologies, improved seeds and crop nutrition. He also highlighted the importance of building farmer confidence and strengthening collaboration among industry, academia, government and the scientific community so that innovations can move from research to practical field applications.
Industry Calls for Research and Technology Development
ACFI Chairman Rahul Dhanuka said the industry should focus on farmer requirements by supporting innovation through an enabling regulatory framework, strengthening domestic capabilities and supply chains, promoting digitalisation and advancing sustainable agriculture. During ACFI’s recent AGM panel discussion, government and industry experts also highlighted the need to strengthen research and technology development. Vishal Chaudhary, Scientific Adviser to the government, said India has established a strong position in agrochemical manufacturing and now needs to complement this capability with greater emphasis on research, innovation and technology development. He also highlighted the role of public-private partnerships and stronger industry-academia collaboration. Sweety Behera, Director, FSSAI, emphasised that agricultural innovation must increasingly address sustainability and consumer safety, alongside productivity.
Biotechnology and Digitalisation to Support Agriculture
Pushplata Singh, Director, TERI, highlighted the potential of biotechnology and nanotechnology to support more sustainable and climate-resilient agriculture. Rajvir Rathi, Director-Agricultural Affairs, Bayer CropScience, pointed to technology licensing and access frameworks as potential mechanisms for connecting agricultural innovation with wider farmer adoption. Gopinath Koneti, Partner and Senior Advisor, KPMG India, emphasised that agricultural innovations ultimately need to demonstrate economic viability, particularly through solutions that deliver measurable and practical value to farmers.
Building a Competitive Crop Protection Industry
Overall, the KPMG report recommends focusing India’s next phase of crop-protection growth on manufacturing competitiveness, innovation commercialisation, supply-chain resilience and lower structural costs. ACFI’s proposed policy framework combines financial incentives, manufacturing infrastructure, regulatory reforms, research support and technology development. As reported by thehindubusinessline.com, the association said these measures could help strengthen India’s domestic agrochemical ecosystem while supporting the development of more sustainable and innovative agricultural solutions.
