Agriculture sector will grow by 3-4% this year, says RG Agarwal, Chairman, Dhanuka AgriTech

Ram Gopal Agarwal, Chairman, Dhanuka AgriTech, talks about the impact of lockdown on his business, government’s plan to ban the use of 27 pesticides and ways to attract foreign companies and investment for the agri-sector among others during an interview with Swati Khandelwal, Zee Business. Edited Excerpts:

Q: Agri sector is one of those which haven’t go affected much due to COVID-19 and lockdown. So, what is your outlook for the year?

A: The year has started on a good note as the forecast for monsoon is very good. Enough water is available in the reservoirs of the country due to delayed monsoon last year. Thus, there is no scarcity of water and that’s why the agricultural sector is expected to grow very well this year. Last year, the sector had a 3.6% contribution to the GDP and this year’s growth in the agriculture sector is expected to be between 3% and 4%. If water is available, the farmer doesn’t want to leave any of his field uncultivated. And, available reports suggest that the sowing has been very good in almost every area. If you have a look at fertilizer sales data till May then its sales have doubled when compared to the last year’s sales data of which 70% of business has been done on cash. Thus, still, there are good growth opportunities in the crop protection industry at present and it is likely to be good in the future as well. 

Q: The government has announced a stimulus package of Rs 20 lakh crore and has also talked about higher MSP. So, do you think it will benefit and give a boost to the rural economy?

A: Availability of more money with the farmers’ will boost to the rural economy. The government has removed the Essential Commodities Act and APMC Act from the Agri sector, which will unchain the farmers from the previous rule in which they were supposed to sell their products just at APMC. Now, he can sell his produce at his door or the field, or to a warehouse or any other place where he will get a better rate for his produce. Thus, the availability of money in the farmer's hand will have a direct impact on the entire economy. As far as other FMCG products are concerned than de-growth has been witnessed in the segment in the recent past. But, I believe that the overall economy will grow well after a Kharif produce is harvested and good money will reach to the farmers

Q: The government in the recent past has banned the use of 27 pesticides. What impact the decision will have on your business?

A: The government hasn’t banned these pesticides but has proposed a ban, which has been opposed by every farmer's union as well as the pesticides industry. These pesticides are being used even in countries like America, Japan and Australia. They have also exported from India in the tune of Rs 5,000 crore and have a domestic consumption of Rs 5,000 crore. In this COVID-period the government is talking about growth in every industry. So, the decision to ban these products amid these situations is not good, whosoever would have taken it. I hope that the government will review its decision. 

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Q: The chemical sector has major dependence on China for raw material imports, what needs to be done to create a domestic alternate when the government is talking about being Atmanirbhar (self-reliant)?

A: The most important thing that is required for the purpose includes the creation of laws and environment in the country that can attract foreign industries as well as companies to India. For instance, Japan has decided to shift every industry from China to either to Japan or some other Asian country and Japanese Prime Minister has also offered a $2.2 billion economic stimulus package to its industry sector for the purpose. However, the new pesticide management bill (PMB) drafted in our country is not promoting it rather the foreign companies are considering it as a negative development. There is no data protection arrangement in our country, however, when a new pesticide is registered for the first time, then data protection ranging from 5 years to 15 years is provided across to them across the world. The objective provided in the newly introduced PMB by the Minister of Agriculture and Farmers Welfare says that we will respect the international treaties but it doesn’t carry any provision that honours it despite respecting the IPR. If such an environment is not created in India till then chemical companies will like to move to other countries like Malaysia, Indonesia, Thailand and Vietnam instead of India. So, I would like to request the government to create an industry-friendly law and environment in India to attract foreign companies. No matter how much we talk about ‘Make in India’ but not a single research on pesticide has been done in our country and all technologies have been imported from the outside world. If the government has any plan to develop indigenous pesticide than it should provide some package to it as it has provided a Rs 13,000 crore package to the pharma sector to develop substitute in India instead of China. To make pesticide sector Atmanirbhar (self-reliant) and increase its export from India should revisit the law that has been drafted for pesticides and create a favourable atmosphere to attract foreign companies towards India, invest here and develop infrastructure for domestic consumption as well as export purposes.