Some of the challenges currently faced by the Indian agrochemical industries are cited

below:
R&D in the field of agrochemicals is expensive and time consuming as evident from the fact
that the creation of a new agrochemical molecule takes about nine years and an investment and
USD 180 million. Indian companies have so far neglected this concept of creating new
agrochemical molecules. Developing such R&D capacities and remaining cost effective at the
same time will prove to be a tough challenge.
The business of agrochemicals is threatened by the genetically modified (GM) seeds which
possess self immunity towards external adversaries.
Widespread and huge number of consumers necessitates a proper network to ensure the
availability of the desired product. Companies have adopted the new policy of eliminating the
distributors from the network and dealing directly with the retailers thereby creating a cost
effective distribution system. Though retailers have to be educated in this process on product
usage, the companies are able to offer a competitive price to the farmers.
Promotion of Integrated Pest Management (IPM), India Government and various NGOs of zero
budget farming and bio-pesticides has started to create awareness amongst the farmers to
reduce chemical usage. Increase in the demand of organic food has initiated farmers in
Karnataka to adapt to organic farming. Agrochemical companies need to combat the
environmental issues and negative impact of pesticides successfully to avoid any disrepute to
agrochemical usage.
Like all strata of our society corruption has permeated the agriculture sector too. The
agrochemicals market is flooded with spurious pesticides, the estimated market of which was
USD 233 million in 2009. This has affected sizable revenue of the legal agrochemicals market.
The Indian agrochemicals market grew at a rate of 11% , that is, from USD 1.22 billion in
financial year 2008 to an estimated USD 1.36 billion in financial year 2009. Agrochemicals
exports contributed to 50% of the total industry turnover in financhial year 2008 and have
achieved a Compound Annual Growth Rate (CAGR) of 29% from 2004 t0 2008.
However, the most comprehensive study on the agrochemical industry of India has been
provided by the apex industry body ASSOCHAM, Indian Market For Agrochemicals which
predicts, Growing at a CAGR of about 15%, the agrochemicals sector in India is likely to cross
Rs 25,000 crore mark by 2015. The Indian agrochemicals market is currently (2012-13) poised at
Rs 16,000 crore. But the agrochemicals market in India is still very fragmented. However, the
huge potential of foreign investment in the Indian agrochemical market is undeniable. The
companies in this sector should increase their investment in the field of research and
development of agrochemicals which in turn will spur the exports increasing competitiveness in
the global scenario.