ACFI Seeks Reduction in Pesticide Import Duty to 5% in India Ahead of Union Budget 2026

29 January 2026, New Delhi: The Agro Chem Federation of India (ACFI) has urged the Union Government to consider reducing the import duty on pesticides from 10 per cent to 5 per cent in the upcoming Union Budget, citing the need to lower cultivation costs for farmers and improve access to newer crop protection technologies.

In a representation submitted to the government, ACFI also called for rationalisation of the Goods and Services Tax (GST) on crop protection chemicals.

According to ACFI, the government has taken several initiatives over the past decade aimed at supporting agriculture and farmers through schemes, subsidies, credit reforms, digital infrastructure and marketing interventions. The federation stated that additional policy measures could further help farmers adopt cost-effective farming practices.

ACFI highlighted that farmers make significant investments in inputs such as seeds, fertilisers, irrigation and labour, and noted that pesticides play a role in protecting crops from pest-related losses. The federation said that changing cropping patterns and agroclimatic conditions have increased the need for access to a wider range of crop protection products, including newer molecules.

“We suggest reducing the import duty from 10 per cent to 5 per cent to ensure that farmers receive the benefit of newer technologies. This decision should be viewed in the context of India’s overall agricultural strategy,” said Dr Kalyan Goswami, Director General, Agro Chem Federation of India.

ACFI also drew attention to the current GST structure for agricultural inputs. While fertilisers attract a GST rate of 5 per cent, pesticides are taxed at 18 per cent. The federation stated that this difference increases the cost of cultivation, particularly for small and marginal farmers.

More than 85 per cent of Indian farmers operate on landholdings of less than two hectares and often face financial constraints and limited access to subsidies, ACFI said. The federation added that higher GST on pesticides affects affordability and adoption of crop protection solutions, which may have implications for productivity.

Given that fertilisers and pesticides are both essential agricultural inputs, ACFI said maintaining different GST rates creates inconsistency within the tax framework.

“In line with the objectives of GST rationalisation, we submit that GST on pesticides may be reduced to 0 per cent as an essential agricultural input, or aligned with fertilisers at 5 per cent to ensure parity,” Dr Goswami said.

Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget 2026 on February 1, 2026, in the Lok Sabha.

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