The Agro Chem Federation of India proposes a multi-faceted ₹5,000-₹7,500 crore scheme to bolster domestic production, drive innovation, and reduce reliance on China in the agrochemical sector amid calls for accelerated infrastructure and regulatory reforms.
The Agro Chem Federation of India has urged the government to create a ₹5,000 crore to ₹7,500 crore support package to build up domestic production of agrochemical technicals and intermediates, arguing that India needs to narrow the cost gap with China. According to reporting by NDTV Profit, the proposal was prepared with KPMG and is designed as a seven- to eight-year programme, with the first two to three years focused on getting new plants commissioned before wider support is rolled out.
The plan calls for a combination of incentives rather than a single subsidy. It proposes a 5% to 8% incentive on incremental sales, along with 30% to 40% support for industrial power and common effluent-treatment infrastructure. It also seeks capital grants for research and development, and a framework that would allow both large manufacturers and smaller firms to participate through graded investment thresholds covering new and existing facilities.
The industry body says the aim is not to create a permanent cushion for producers, but to correct structural disadvantages that have left Indian manufacturers weaker than global rivals on cost. It is also pressing for purpose-built agrochemical parks with shared utilities, stronger backward integration in critical inputs, and a single digital clearance system to speed up approvals from central and state authorities. The proposal gives special emphasis to biological pesticides, where ACFI says clearer and faster regulatory pathways are needed.
Beyond manufacturing capacity, the report argues that India’s next stage of growth will depend on innovation, product development and supply-chain resilience. It says the country already has strengths in process chemistry, formulations and regulatory execution, but needs to deepen its capabilities in biologicals, regulatory science and digital agriculture. Rahul Dhanuka, ACFI’s chairman, said the sector’s success will depend on turning innovation into “practical, accessible and trusted solutions” for farmers.
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