India's promising future in the agrochemicals market
The agrochemicals industry in India is experiencing significant growth and is expected to continue expanding in the coming years. The market size reached nearly $6 billion in 2022 and is projected to grow at a CAGR of 8.5% between 2023 and 2028, reaching a value of approximately $9.82 billion by 2028. This growth is attributed to favorable domestic policies, supportive investment, increased production capacity and infrastructure development by Indian companies. The Government of India's 'Make in India' initiative, which aims to promote domestic manufacturing, has played an important role in supporting the agrochemical industry. This initiative has reduced regulatory hurdles, facilitated necessary infrastructure upgrades, and enabled India to become a global hub for the production of agrochemicals. Government and industry have also invested heavily in research and innovation to develop new molecules, manufacturing processes and green chemistry products.
One of the key factors behind India's growth in the agricultural sector is the integration of production processes. Indian companies have invested in the production of off-patent molecules and reduced their dependence on imports from China. They are also focused on registering off-patent products and developing relationships with distributors to increase volume at more affordable prices. Indian manufacturers are known for impeccable quality and cost-effective production of organic phosphorus, carbon disulfide and pyrethroid chemicals.
However, there are challenges that need to be addressed. India currently lacks yellow phosphorus, which limits the production of some intermediates. The country also lacks large manufacturing facilities like China. In addition, agrochemicals are exempt from the government's Production Linked Incentives (PLI) scheme, which provides incentives for goods manufactured in India. Including agrochemical products in the PLI scheme and regulating the import of agrochemical formulations can attract new investments and support the government's efforts to realize the "Make in India" programme.
Despite these challenges, the future of India's agriculture industry looks promising. The changing agricultural landscape in the country provides new opportunities for producers, formulators and suppliers. According to a report, the industry's revenues will grow by 15-17% in 2023 and by 10-12% in 2024, driven by strong exports and stable domestic demand. The growth of this sector depends on factors such as the availability of raw materials and favorable weather conditions.
Overall, the Indian agrochemicals industry is on a positive growth path supported by government initiatives, increased production capacity and innovation. The country has the potential to become a major player in the global agrochemical market by focusing on domestic production and development of high-quality, cost-effective products.
