Agrochemical industry body ACFI has pitched a Rs 5,000-7,000 crore support scheme to the government, arguing it’s needed to make India self-sufficient in agrochemical technicals and intermediates while neutralising China’s cheaper production costs.
Prepared alongside consultancy KPMG, the proposal envisions a seven-to-eight-year rollout, with two to three years set aside for getting plants up and running before sustained support kicks in.
Incentive Structure And Guardrails
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On the incentive side, the ACFI wants a 5-8% boost on incremental sales paired with 30-40% subsidies covering industrial power and shared effluent treatment, plus capital grants earmarked for R&D and graded thresholds that would let both large and small manufacturers, across new and existing plants, tap into the scheme.
Notably, the report frames this as temporary course correction rather than a permanent crutch, explicitly warning against building in long-term subsidy dependence. It also pushes for purpose-built agrochemical parks with shared infrastructure, backward integration on key intermediates, and a single digital window to speed up central and state approvals, with faster, clearer rules specifically for biological pesticides.
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Biologicals Seen As The Bigger Opportunity
The report’s broader argument is that capacity expansion alone won’t cut it, India already does process chemistry, formulations and regulatory work well, but needs to catch up on product development, biologicals, regulatory science and digital agriculture.
Biologicals in particular stand out as an opportunity given India’s biodiversity and fermentation expertise, though ACFI flagged real hurdles ahead: getting batches consistent, formulations stable, manufacturing scalable, and products validated across locations before farmers will actually adopt them. To close that research-to-market gap, it called for more pilot plants, field-testing networks, GLP-certified labs and residue-testing infrastructure.
“India’s next phase of growth in crop protection should be anchored in strengthening ecosystem competitiveness, accelerating innovation commercialisation, enhancing supply-chain resilience and reducing structural cost disadvantages,” the report said. ACFI Chairman Rahul Dhanuka said turning innovation into solutions farmers can actually trust and access would be key to the sector’s success.
(With PTI inputs)
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