January 30, 2024
Industry Calls for Competitive Tax Reforms and Greater R&D Support in Budget 2024
Indian chemical industry has sought expects competitive tax structure, support for raw materials, strategic initiatives, expanded funding for R&D and technological support to maintain sustainable growth
With Union Budget 2024 round the corner, Indian chemical industry has sought competitive tax structure, support for raw materials, strategic initiatives, expanded funding for R&D and technological support to maintain sustainable growth. ICN carries here industry’s expectation from Union Budget 2024-25.
S. Sunil Kumar, Country President - Henkel India
“In recent years, India's chemicals sector has surged, becoming the 6th largest producer globally and 3rd in Asia, contributing 7% to GDP. The industry reports indicate a compelling future, with a projected CAGR of 11–12%, by 2027. The sector is primed for rapid expansion, driven by heightened demand, a growing domestic base, and evolving consumer preferences. We anticipate the Interim Budget to introduce competitive tax structures, support for raw materials, and strategic initiatives, serving as a catalyst for the continued growth. With these, the Indian chemicals sector can become a global leader, boosting the economy, and paving the way for a sustainable future.”
Rajesh Aggarwal, Managing Director, Insecticides India
"As we approach the threshold of the 2024 budget, the agricultural sector needs higher allocation for indigenous Research and Development (R&D), with a focus on fostering innovation in sustainable farming practices to bring in the research based latest technology products for crop protection and nutrition within the reach of even small and marginal farmers."
The initiation of a Crop Diversification Programme is poised to enhance agriculture's resilience, impacting the market for agricultural inputs due to the diverse challenges posed by different crops. Finally, the successful implementation of the PM-AASHA initiative is considered pivotal in stabilizing farmers' income.
The indigenous industry had made a detailed proposal to Govt for including agrochemicals now a “Champion sector” under Production Linked Incentive (PLI) scheme so that the manufacturers could be incentivised to enhance their production (capacity utilisation being 55% at present ).”
Raju Kapoor, Director, Industry & Public Affairs, FMC India
"As we enter the New Year, we welcome 2024 with cautious optimism about the industry outlook emerging out of the challenges encountered by the industry in the year 2023 for the agrochemical industry. The agriculture sector during 2023 saw GVA of the sector falling to 1.8%. While the underlying key drivers for the agrochemical industry remained intact. Hence, there is a need for the sector to reboot itself."
"The second half of the year 2023 witnessed significant adverse impact of destocking on the crop protection industry, globally. During 2024, weather permitting, one anticipates an upturn in the Indian crop protection industry only towards the third/fourth quarter of the year, signaling a return to normalcy in the overall market dynamics. While the area under sowing for the Rabi 2023 is largely intact for field crops, the reduction in the pulses and oil seeds area in the sowing is negative for the industry."
"One should expect moderation in the ‘dumping’ of agrochemicals from China. A significant advancement on the technology front is the much expected ramp-up of use of ‘drones as a service’ for applying fertilizers and agrochemicals. It is likely to get a major boost with the introduction of the government-backed ‘Drone Didi’ scheme. Better coordination between fertilizer and agrochemical industry would help stabilize drones as a service concept, improving the efficiency and efficacy of crop protection and nutritional use efficiency."
"We should also expect launches of newer molecules to combat stubborn weeds such as Phalaris in wheat crops and insecticides segment, such as pink bollworms. This is expected to get a push by the declared intent of the regulatory body, the central insecticide board, to rationalize the time taken for regulatory approvals of new molecules."
Sanjiv Kanwar, MD, Yara South Asia
“We welcome the direction and scaling up of support for the schemes for the farmers, especially across credit and insurance, as well as for the agriculture accelerator fund. This will be positive for the agriculture and farm sector and will spur growth. Overall, the sustained focus of the government on ease of doing business for the industry is welcome. While we understand this is an interim budget, there is an opportunity to enhance sustainability of agriculture sector in India through policies that encourage greater use of solutions such as bio-stimulants, as well as enhancing nutritional sufficiency in soil health. We plan to work with stakeholders in the government and industry to build consensus on these areas, enhance choice for farmers, and simplify regulations.”
Pre-Interim Budget Expectations FY 2024-25
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