By Susheel Kumar
Indian agriculture stands at a pivotal inflection point, balancing ambitious global aspirations with pressing domestic policy challenges. On one hand, the nation confidently projects itself as an emerging global food powerhouse, a trusted supplier to international markets, and a potential hub for agricultural manufacturing. On the other hand, the policy ecosystem surrounding crop protection—the critical backbone ensuring yield security, farmer resilience, and food price stability—is undergoing significant transition. As the Union Budget 2026 approaches, this moment offers a vital opportunity to inject sharper clarity, renewed confidence, and a steadfast commitment to science-based decision-making into India's agricultural framework.
The Critical Role of Crop Protection in India's Food Security
Over the past year, public discourse on crop protection has been particularly animated, yet often imbalanced. Pesticides and protective agents are frequently discussed primarily through the narrow lens of risk, while their indispensable role in preventing catastrophic losses, safeguarding farmer incomes, and containing food inflation receives insufficient attention. This skewed debate unfolds against a stark reality: Indian farmers continue to suffer crop losses exceeding ₹2 lakh crore annually due to pests, diseases, and weeds. Such massive losses represent an unsustainable drain for any nation aspiring to robust food security and export leadership in agricultural products.
A Regulatory Reset That Must Achieve Optimal Balance
The proposed Pesticides Management Bill, 2025 marks a significant legislative move, aiming to align India's regulatory framework with contemporary agricultural realities. Its intent to strengthen oversight, improve compliance, and protect both farmers and consumers is both timely and necessary. However, as with all foundational reforms, the true impact will hinge on how effectively these intentions translate into practical, field-level implementation.
For an innovation-driven sector like crop protection, predictability and proportionality in regulation matter as much as stringency. A regulatory system that is genuinely risk-based, science-led, and time-bound does not compromise safety; rather, it enhances it by encouraging responsible industry participation, greater investment in stewardship programs, and faster adoption of safer, newer technologies. India's crop protection sector, led by R&D-driven companies that account for nearly 70% of the market and have introduced 95% of the molecules used domestically, invests over USD 6 billion annually in global research and development. Ensuring this rich innovation pipeline reaches Indian farmers necessitates a regulatory approach that consistently values scientific evidence alongside prudent precaution.
The proposed Pesticides Management Bill can be powerfully complemented by a Union Budget 2026 that supports enhanced regulatory capacity, modern testing infrastructure, and efficient evaluation timelines. Together, these measures can ensure the new framework functions as a bridge to safer, more productive agriculture rather than an unintended bureaucratic bottleneck.
GST Rationalization: A Farmer-Centric Policy Correction
One of the most immediate and impactful expectations from Budget 2026 is the rationalization of Goods and Services Tax (GST) on crop protection products to a maximum rate of 5%. This would align their taxation with other critical agricultural inputs like fertilizers, biostimulants, and biologicals. Such a step would directly ease cost pressures on farmers and reinforce responsible usage by improving access to legitimate, high-quality products from regulated channels.
Viewed holistically, GST rationalization is not merely a concession to industry; it is a vital, farmer-centric policy correction. It strengthens productivity, enhances safety standards, and improves compliance across the entire agricultural value chain, from input suppliers to end consumers.
Seizing Global Manufacturing Opportunities
Globally, agrochemical supply chains are undergoing a structural realignment. Companies are actively diversifying their manufacturing bases to reduce geographical concentration risks. India is exceptionally well-positioned to benefit from this global shift, provided its policy ambition is matched with enabling fiscal and industrial frameworks.
A targeted Production Linked Incentive (PLI) scheme for the manufacture of new, advanced crop protection molecules could attract global-scale investments, deepen domestic manufacturing capabilities, and integrate India more firmly into resilient international supply chains. This initiative transcends mere import substitution; it is about strategically positioning India as a reliable, competitive, and high-quality producer for global agricultural markets.
Backing Agricultural Innovation with Robust Fiscal Intent
Crop protection innovation is inherently science-intensive, capital-heavy, and long-term. Developing a single new molecule can span more than a decade, demanding sustained investment and regulatory certainty. While India has made commendable strides in recognizing innovation across various sectors, significant scope remains to further strengthen fiscal support specifically for agricultural R&D.
Introducing a 200% weighted tax deduction on recognized research and development expenditure in agriculture would send a powerful message that innovation in this sector is central to India's growth narrative. Equally important is formally recognizing stewardship—encompassing farmer training, resistance management, and safe-use education—as a legitimate extension of public policy goals. Investments made by companies in these areas directly support national objectives for food safety and environmental sustainability. A 150% tax deduction on such stewardship expenditure would strategically align fiscal policy with the sustainability objectives already embedded in India's national priorities.
The Constructive Choice for Policymakers
As Budget 2026 is finalized, policymakers face a constructive and consequential choice. India has the opportunity to decisively reinforce crop protection as a strategic lever for achieving multiple national goals: enhancing farmer resilience, driving agricultural export growth, and ensuring long-term food security. This requires ensuring that fiscal and regulatory frameworks evolve in lockstep with the nation's agricultural ambitions.
The direction chosen will profoundly shape not only industry outcomes but also the long-term stability, productivity, and global competitiveness of India's entire agricultural economy. The moment for clear, confident, and science-backed policy action is now.
(Susheel Kumar is Managing Director, Syngenta India)
