India's Seed Industry Calls for Enhanced Policy Support Amid Rising Costs
Seed industry seeks policy support amid input cost increase
The Economic TimesImage: The Economic Times
India's seed industry is urging the government for increased policy support as input costs surge due to the West Asia crisis. Key requests include doubling income tax deductions on R&D investments and utilizing the Agricultural Infrastructure Fund for energy transition, aiming to save ₹800 crore annually for reinvestment in research.
- 01The seed industry seeks to double income tax deductions on R&D investments.
- 02Input costs have risen significantly due to the West Asia crisis.
- 03Private seed firms invest over 10% of their revenue in research.
- 04Regulatory harmonization across states is requested to ease business operations.
- 05The proposed reforms could save the industry ₹800 crore annually.
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The seed industry in India is facing rising input costs linked to the ongoing crisis in West Asia, prompting a call for government policy support. The industry is requesting a doubling of income tax deductions on private research and development (R&D) investments, which were previously set at 200% but reduced to 100% since 2020-21. Private seed companies, which typically allocate over 10% of their annual revenue to R&D, argue that enhanced incentives are crucial for sustaining innovation and long-term productivity in agriculture. Additionally, they are advocating for the use of the Agricultural Infrastructure Fund (AIF) to transition from liquefied petroleum gas (LPG) to alternative energy sources. Raghavan Sampathkumar, executive director of the Federation of Seed Industry of India (FSII), emphasized that the ongoing crisis has led to significant spikes in costs related to energy, packaging, and distribution, creating operational stress. He stated that policy reforms could save the industry an estimated ₹800 crore (roughly $96 million USD) annually, which could then be reinvested into R&D efforts.
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The proposed policy changes could alleviate financial stress for seed companies, potentially leading to lower input costs for farmers and increased agricultural productivity.
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