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Budget 2023: Here's What Dhanuka, Sammunati, Yara South Asia, Syngenta, Insecticides India & Netafim Predict for Agri Sector

As India waits for the Budget 2023 reveal on February 1, here's what the industry leaders predict for the agriculture sector and farmers in the Budget 2023.

Binita Kumari
Budget 2023: Here's What Dhanuka, Sammunati, Yara South Asia, Syngenta, Insecticides India & Netafim Predict
Budget 2023: Here's What Dhanuka, Sammunati, Yara South Asia, Syngenta, Insecticides India & Netafim Predict

The year 2022 has been difficult for the world food system, to put it mildly. In the wake of issues like extreme weather calamities, supply-chain disruptions, geopolitical tensions, global conflicts, and rising food waste, it revealed a number of structural flaws. The year also highlighted our shortcomings in managing world hunger and ensuring food security, undoing the major advancements over decades of efforts. 

Budget 2023-24 predictions for the agriculture sector:

Dinesh Patidar, Chairman and Managing Director of Shakti Pumps (India) Ltd. made the following predictions:

"We anticipate the Union Budget to place a major emphasis on the energy sector, considering the stated targets in green energy and its significance for economic growth, the government is likely to broaden the PLI incentives to integrate supply chains, fund and mobilize resources, and counteract the possibility of global risks and slowdown in development. To meet the goal of using non-fossil fuel power, solar will continue to play a significant role. Tax holidays should be provided to increase the ease of doing business for this technologically intensive industry. The government could also consider allowing the availment of credit or reducing the GST rates for the supply of raw materials used in the manufacturing of solar products. A major focus of the Budget will be to encourage the manufacturing of domestically produced cost-effective solar modules and a relief in GST for the R&D products required for the development could go a long way in establishing sufficient infrastructure for research and development that meets global standards at competitive prices. We believe that the government will offer concessional import duties on solar modules, which could defeat Atmanirbhar Bharat's purpose of import substitution.

Randhir Chauhan, MD, Netafim India and SVP Netafim predicted that:

Process streamlining measures in irrigation subsidy

The delays in the disbursal of micro-irrigation subsidies under the PMKSY program have hampered its progress. Online portal for an end-to-end process execution and visibility, transparency in the process for fund disbursement, ensuring checkpoints at various stages and adherence to timelines would bring efficiency in subsidy disbursal and support farmers to be debt-free in a faster way.

Diversification programs to increase productivity and value in different crops like oilseeds, oil palm, and rice with a special focus

The 12 percent of the cropped area under Fruits & Vegetables (F&V) leads to 24 percent in value terms, in contrast to 13 percent land under oilseeds which gives only 6 percent in value terms because of lack of scalability. Addressing the domestic demand for edible oils, it is inevitable to promote domestic oilseeds and oil palm cultivation with higher productivity measures. Similarly, rice being one of the crucial crops both in terms of area coverage and usage of water, promoting drip technology will help increase the yield, save water and reduce carbon emissions. Drip irrigation adoption also facilitates crop diversification, thus, making a direct impact on farmer income

Sanjiv Kanwar, Managing Director, Yara South Asia

“We are enthusiastic about the opportunities and pathways that are opening up for engagement in the sustainability, food, and nutrition sectors as India assumes the G20 leadership this year. At Yara, we are hoping for a push toward simplifying regulations for introduction of innovative crop nutrition products, particularly micronutrients and speciality fertilisers. Nutrition will be critical to food security in India, given that we may take the title of the most populous country in the world this year. Therefore, we firmly believe that introducing the ‘Plant Nutrition Management Bill’ is necessary and ought to be a top priority for 2023.

Soil fertility and micronutrients will be critical to meet the quality requirements for the food being produced in the country. Hence, bringing parity between the taxation on bulk fertilizers and micronutrients will help farmers take advantage of these products to not only improve quantity, but also quality of produce. In fact, measures like direct benefit transfers of subsidy amounts into farmers' bank accounts, will empower them to make a choice of products and services to be used to improve overall productivity for the farm sector. This step will also give wings to the export aspirations of the country.”

M K Dhanuka, Managing Director, Dhanuka Agritech made the following prediction:

“We expect that the government will take a view on reducing the custom duty on import of Pesticides. This move will enable our farmers to buy pesticides at reasonable prices. Apart from this, the GST on agrochemicals should be reduced to either 5% or be eliminated completely so that companies like Dhanuka can pass on the benefits to the farmers.”

Anil Kumar SG, Founder & CEO, Samunnati predicts that:

For Samunnati, FPOs remain at its core and it is important to make them thrive and work more efficiently. We strongly believe that any innovative intervention at any node of the value chain ultimately results in benefiting the farmers. Hence, we wish the Budget 2023 will take a holistic and comprehensive perspective particularly, around FPOs and the connected ecosystem.
Currently, India is at a unique place where its economy will not only touch US$ 5 trillion but also be self-reliant, and resilient. Farmer collectives are all set to play a big role in ensuring food and nutritional security for its 1.3 billion population. But to make it happen, a lot needs to be done as mentioned in the ‘The State of Sector report 2022 on FPOs’ to enhance their access to capital, technology, and markets, which are crucial for the evolution of the FPO sector to integrate them into agri value chains. Secondly, NBFCs that are in the business of lending to farmers can do a lot to enhance financial inclusion and overall prosperity across the agri value chain. Hence, anything to help bring down the cost of lending, promote synergistic partnerships with the public sector, and provide a level playing field to participate in government schemes will be more conducive to its growth.

Dr KC Ravi, Chief Sustainability Officer, Syngenta India Pvt Ltd predicted that:

Indian agriculture is on the threshold of a quantum jump toward sustainability and resilience. A series of enabling measures taken in the recent past have infused a lot of vitality in agriculture. The push to use of new technologies has drastically reduced the drudgery of farming operations.

In view of ever-growing input costs, which put farmers at extra financial exposure, the Union Budget 2023-24 should consider reducing the Goods and Services Tax (GST) on crop protection products, farm equipment, seeds, and other inputs. An enhanced outlay for PM-KISAN will also ensure farmers get more liquidity to buy inputs. The industry is also expecting the Government should devise a special Production Linked Incentives (PLI) scheme for the agrochemical sector which will have a spiraling effect on boosting manufacturing in India.

Emerging technologies such as drones and artificial intelligence (AI) are proving to be game changers. We are anticipating further impetus to the use of technology including drones in agriculture, as a follow-up of the previous year's announcements. The proposed digital crop survey, which shall enable a shift from the old patwari system to a more robust AI/ML and GIS-GPS-driven mapping of cropland, will not only benefit the Government but also the private industry. We are expecting some announcements in the Budget on this.

Rajesh Aggarwal, Managing Director, Insecticides India Limited made the prediction that:

"Agriculture and its allied sectors are the largest sources of livelihood in the country. The sector employs almost half of India's population, accounting for about 16% of the country's GDP. It is important to note that the crop protection industry has a vital role to play to take Indian agriculture to new heights. The significance of crop protection & nutrition has been rising over the last few decades, pushed by the requirement to increase overall agricultural production and the need to safeguard adequate food availability for the continuously growing population in India. 

Indian Companies have also geared themself for the new technology with their R&D initiatives and awareness campaigns in the last few years. There have been a few new interventions like Drone technology, where the Govt. has acted fast and taken it to the next level though it is still in the nascent stage. It is expected to help farmers optimize the use of insecticides and increase their efficacy as well. 

The upcoming budget should look forward to allocating funds to research and development activities to develop new more effective and safer solutions for the control of pests, diseases, and weeds for chemical and as well as biological streams. Different forms of incentive to the companies engaged in such R&D activities can be a motivating factor for them to invest more in the same. 

The government should also make budgetary allocations and develop more aggressive awareness missions for the new technology and new crop avenues so that input costs can be reduced and output value can be maximized. The budget needs to take this into account and provide higher allocation to horticulture.

Government subsidies and initiatives are required for safe farming, enhanced focus on sustainable development, and expanding crop supplier and manufacturing base network. To facilitate the growth of agri-exports, the government should speed up and ease the documentation process for registrations, incentivize global collaborations, and educate stakeholders. 

Moreover, the industry needs more support from the government to maximize the agricultural output in 2023 in form of incentives like PLIs. The agrochemicals sector should see positive momentum coupled with banking as credit penetration for farmers continues to improve."

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