On the eve of its Annual General Meeting, the Pesticides Manufacturers and Formulators Association of India (PMFAI) had organised a seminar on agrochemicals at Mumbai on   October 10, 2000. PMFAI is one of the leading business associations of the agrochemical industry with more than 200 members.

In his welcome speech, Pradeep P Dave, President of PMFAI noted that the industry has not been doing well for the last few years. Consumption is getting saturated due to the increasing use of Genetically Modified (GM) seeds. As a result, plants are less prone to insect attacks. He pointed out that though demand has fallen, large capacities exist within the industry and this is resulting in heavy competition.

To deal with this scenario, like-minded companies need to work towards creating a common strategy for the industry. There needs to be greater focus on exports. Production needs to be controlled to prevent unhealthy competition. He emphasised the need for Indian industry to develop new molecules and create new markets.

Dr A D Pawar, Secretary, Central Insecticide Board and Registration Board, who presided over the occasion as Chief Guest, called upon the industry to develop a farmer-industry partnership like in other countries. In the Indian context, the industry could become an active participant of the Integrated Pesticides Management (IPM) programme.

He invited the industry to undertake industry-funded research on issues that were of interest to the farmers as well as to the industry. Rallis India Ltd has already come forward and is promoting IPM, he said.

The main focus of the seminar was on the need and the importance of R&D in the agrochemical industry. One of the speakers, Dr M K Gurjar, Deputy Director Organic Chemical Technology, National Chemical Labs (NCL), Pune, spoke on the subject ‘Research and Developmental Opportunities for the Indian Agrochemical Industry.’ He listed out the issues that were facing the industry and also enlightened the audience on the avenues that were available to deal with these issues proactively.

At the outset, he noted that while the Indian agrochemical industry had made a tremendous contribution to the country’s agriculture, especially during the Green Revolution, the Indian industry’s efforts were mainly focussed on the manufacture and formulation of pesticides. He pointed out that one of the reasons why top agrochemical companies in the world such as Aventis, Novartis and Monsanto have achieved large turnovers is because, in addition to pesticides, they have also developed fungicides, insecticides, GM seeds and growth regulators. The Indian industry is suffering as it is focussing only on pesticides.

According to Dr Gurjar, the Indian pesticide industry experienced rapid growth in consumption during 1973-74, especially with the patent laws of 1970 that allowed process patents. The industry has taken maximum advantage of this but the rising sales of GM crops coupled with increasing plantations of pest-tolerant and insect-tolerant varieties has resulted in a reduction in demand for conventional pesticides by 3.1 per cent. In order to deal with this and with the increasing level of competition, the Indian industry needs to upgrade their technology and capacity for quality, safety and environmental friendliness.

He noted that the pesticide industry is undergoing a change and so is the concept of a desired pesticide. Despite the regulations imposed by WTO on the pesticide industry, India is recognised as an alternate destination for some products, which involves processes that are not environmentally benign. He pointed out that in the new scenario, management of hazardous waste as well as effluent treatment are also important factors for the Indian pesticide industry.

He noted that the R&D facilities of the Indian industry have focussed on process development and on new pesticides by way of reverse engineering. He decried the industry for not having spent enough time on developing new molecules. Another area of concern pointed out by him was that the industry was not paying enough attention to the development of chiral agrochemicals. This, according to him, is resulting in the contamination of the environment with unwanted isomers.

Next, he cited small usage of pesticides in India as another area that should concern the industry. India’s population is around 1 billion and is expected to rise to 1.5 billion by 2040. Food grain production is 200 million tonnes today and by 2040 the requirement will be 300 to 350 million tonnes. This means a growth of around 1.5 per cent per annum.

On the other hand, China’s population today is 1.2-1.3 billion and the food grains production is 300-350 million tonnes, even though the arable land in China is less than the arable land in India. This is mainly due to the higher usage of pesticides in China. In India, pesticide usage is only 0.6 kgs per hectare.

He also drew the attention of the audience to the new Patent Bill of 1999, which is a prelude to the introduction of product patents in addition to process patents. Patent term has been increased to 20 years for both process and product patents. By 2005, no one will be permitted to manufacture patented products, except the patent holder, he said.

To deal with the above challenges he listed out certain necessities and opportunities for R&D in the agrochemical industry:

1. The need to seek government assistance in line with that given to the pharma industry

2. The need to develop screening/field trails within the industry

3. The need to involve CSIR/ICAR/agricultural universities in the developmental work

4. The need to initiate a new agrochemicals development programme. In his speech, Dr D S Iyengar, Deputy Director New Organic II Division, Indian Institute of Chemical Technology, Hyderabad, specified some new generation active ingredients that could be evaluated by the Indian agrochemical industry. These are:

a. Insecticides- Flourinated Pyrethroids, Tefluthrin, Bifenithrin, Fiproles and Neo-nicotonoids
b. Herbicides- Imadazolinones
c. Fungicides- Epoxyconazole
d. Respiratory inhibitors
e. Insect growth restrictors
f. Single Isomer agrochemicals

5. There exists an opportunity for switching racemic pesticides over to chiral pesticides. In chiral pesticides, pesticidal activity resides in only one isomer. This prevents the contamination of the environment with unwanted isomers. Today most pesticides (except pyrethroids) are sold in the racemic form. If a chiral pesticide is introduced for the first time then it can be registered as a new pesticide. Ideal candidates for a racemic switch are Paclobutrazol, Indoxacarb and Dichloroprop-P.

6. Another opportunity available to the industry is the manufacturing of custom chemicals for other companies. MNCs want to reduce/contain the cost of chemicals and this can be achieved through outsourcing. The business of fine chemical firms producing chemicals to a special order for other companies is called custom chemicals outsourcing.

The worldwide market for custom chemicals is around $10 billion with a growth rate of 5-10 per cent p.a. In North America, the market is around $3.6 billion and is steadily increasing in Europe and Asia. Companies that outsource do not always look for low prices. It boils down to lowering cost but not always the lowest cost. Another function of a custom producer is the introduction of new technologies. For example Rutgers Organics has established phase transfer catalysis as a new technology, wherein reactions are done in water.

7. Plant Growth Regulators (PGRs) represent another opportunity for the agrochemical industry. PGRs are substances used to increase crop and fruit yields. PGRs are useful for GM crops. For example, Cycocel is used in cotton crops to reduce vegetative growth and increase ball size and Maleic hydrazide is a PGR for onions. Brassinosteroids is a PGR developed by NCL for Godrej Agrovet Ltd. Godrej markets this PGR for increasing berry size and yield of grapes.

8. There exists an opportunity to develop biocides to reduce the growth of microbiological organisms. All the big agrochemical companies are key players in biocides development and manufacturing. The US market is $1.3 billion with a 4 per cent per annum growth rate. This is not used in agriculture but the structures are related to pesticides. They are used in water-cooling, water treatment and disinfectants. They are now also being used for rinsing meat to destroy the bacteria that develop in uncooked meat.

9. Another opportunity exists for developing pheromones as pest control agents. Pheromones are defined as substances that are secreted to the outside by an individual and received by the second individual of the same species for mating purposes. These pheromones can be used for monitoring the growth of insect population especially before the use of pesticides so that the indiscriminate use of pesticides can be avoided. Insect pheromones for crops such as cotton, cabbage, sugarcane, potato and fruits are useful for India.

Only two companies in India are actively involved with pheromones, but more systematic efforts and scientific studies are required to popularise pheromones as alternative pest control agents.

10. Another area that CSIR is already working on and which can be viewed as an opportunity for better waste management is the sonolytic degradation of hazardous organic compounds using ultrasonic radiation. Ultrasound enhances mass transfer into aqueous phase by induced micro-currents followed by sonolytic degradation to generate products that are easily biodegradable. This process will be tested on chemicals such as chlorinated benzenes, biphenyls and polychlorinated pyridines.

Another speaker, Dr M S Mithyantha, Rallis India Ltd Research Centre, pointed to additional challenges that are facing the industry today:

1. Regulatory norms are becoming stringent
2. Product potential is dwindling as usage is becoming more specific
3. Cost of products and margins are falling
4. The advent of WTO
5. Trends in pesticides usage is tilting in favour of bio-pesticides rather than organic pesticides
6. Developmental costs are increasing
7. Success of new products is suspect as they may be launched with due research but may find no buyers
8. Customer satisfaction is becoming more important as farmers are becoming more demanding

Some of the delegates pointed out that it was time that the Indian pesticide industry is treated on a par with the fertiliser industry. Since the industry is not as organised as the pharma sector, it was also observed that the pesticide industry is not getting the same level of attention from the government.

In addition, it was felt that instead of each association making separate representations to the government, all the associations should work together. Further, it was pointed out that the time had come for the industry to upgrade its image since pesticides were increasingly getting a bad name.