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Article: Industry stunned by Indian proposal to ban 27 pesticides
22 May 2020
This article is taken from Agrow dated 22/05/20.
The proposal to ban 27 pesticides, including some widely sold
active ingredients, by India's Ministry of Agriculture has left
Indian companies stunned.
The proposal to ban 27 pesticides, including some widely sold
active ingredients, by India's Ministry of Agriculture has left
Indian companies stunned.
The proposal is shocking not only because the list includes some
of the largest sold and exported active ingredients, many of them
considered indispensable for Indian farmers, but also due to the
timing of it when the industry is already dealing with the
repercussions of the country-wide Covid-19 lockdown. "The Covid-19
pandemic has caused huge disruptions in the agricultural supply
chain, coupled with labour shortage and in the absence of properly
planned alternatives, crop yield, food security and farmers'
livelihood in the country will be adversely impacted with this
ban," says CropLife India.
Some of the purported reasons for the proposed bans on the ais -
their being banned in other jurisdictions around the world and a
lack of data - do not hold true for many of those ais, some
industry analysts that Agrow spoke with pointed out. For
instance, among the reasons for banning the fungicide, mancozeb,
the order mentions that it has been banned in one country, namely,
Saudi Arabia, which could hardly be called a cause for grave
concern, they point out. Similarly, the insecticide, malathion, has
been mentioned as having been banned in Syria and Palestine. "The
order has certain factual errors, inconsistencies and incomplete
claims; as per the data submitted by our member companies and other
original registrants for some of these molecules," says CropLife
India's chief executive officer, Asitava Sen.
The 27 pesticides are: the insecticides/acaricides, acephate,
benfuracarb, carbofuran, chlorpyrifos, deltamethrin, dicofol,
dimethoate, malathion, methomyl, monocrotophos, quinalphos and
thiodicarb; the herbicides, 2,4-D, atrazine, butachlor, diuron,
oxyfluorfen, pendimethalin and sulfosulfuron; and the fungicides,
captan, carbendazim, dinocap, mancozeb, thiophanate-methyl, thiram,
zineb and ziram. The draft order called "Banning of Insecticides
Order 2020" was published in the government gazette on May 18th and
it shall be taken into consideration 45 days from the date of
publication.
While these products were duly registered in the country after
scientific evaluation for their safety and efficacy by CIB & RC
(Central Insecticides Board and Registration Committee) and they
were further supported with more scientific data, as and when
required by the regulatory body, CropLife India says. Farmer woes
will increase during the approaching kharif season and at a time
when locust attack is looming over the border areas of Punjab and
Rajasthan, it cautions.
Impact on the industry
CropLife India cites a third-party study, which estimates that
the proposed ais together constitute about 18-20% of the Indian
market. Indian financial company IIFL estimates that the ais make
up over 20% of the Indian agrochemical industry's annual revenues,
including the domestic and export markets. IIFL estimates acephate
and mancozeb to have the biggest shares among the domestic and
export markets. It estimates the market for acephate at around Rs
21,000 million ($277 million), of which Rs 11,500 million ($152
million) comprise exports. For mancozeb, IIFL estimates the market
at Rs 15,500 million ($205 million), of which Rs 11,000 million
($145 million) come from exports.
Most leading Indian companies will suffer the impact if the ban
were to come into effect. For the biggest among them, UPL, although
it has a broad portfolio, would be affected by a ban on most ais in
the list. Some of the key ais for the company from a domestic as
well as export perspective would be mancozeb, acephate and
pendimethalin. In addition, it holds a substantial share of the
domestic monocrotophos market.
The inclusion of some organophosphate ais, such as acephate,
chlorpyrifos and monocrotophos would impact companies including
Rallis India and Insecticides India. Rallis would further be
impacted by the bans on pendimethalin, atrazine and captan.
Mancozeb would also impact Indofil and Coromandel
International.
Opportunity lost?
The disruption of manufacturing within China since February
because of Covid-19 and the subsequent continuing disruption in
logistics and transportation was seen as an opportunity for the
Indian industry to grab some of China's export business. "Due to
the unprecedented crisis of COVID-19, many countries want to shift
their production bases and trade from China," says Mr Sen. He calls
that a "remarkable opportunity" for India. "However, to capitalise
on the situation, we need to present a positive and stable
investment climate, coupled with a non-alienated regulatory
framework," Mr Sen point out. He cautions that a sudden ban on 27
molecules generates negative sentiments for investments. "India is
one of the largest producers and exporters for some of molecules
listed in the draft order; and a ban will also lead to adverse
impact on global supply chain," warns Mr Sen.