Exclusive Interview with Dr. R.G. Agarwal, Chairman Emeritus, Dhanuka Agritech Limited
13 February 2025, New Delhi: In an exclusive conversation with Dr. R.G. Agarwal, Chairman Emeritus of Dhanuka Agritech Limited, Krishak Jagat discussed company’s recent strategic moves, including its agreement with Bayer AG, advancements in agrochemical solutions, and future plans for sustainable agriculture. Dr. Agarwal sheds light on how Dhanuka is leveraging technology to support smallholder farmers, expanding into international markets, and driving innovation in crop protection. The discussion covers the potential of Iprovalicarb and Triadimenol acquisition, Japanese partnership, and the evolving role of India as a global hub for agrochemicals.
Q. Could you provide an overview of Dhanuka Agritech Limited’s current performance in the market and any significant milestones achieved recently? Additionally, could you elaborate on Dhanuka Agritech’s agreement with Bayer AG for Iprovalicarb and Triadimenol and its expected impact (financial) on the company’s offerings?
Dhanuka is a leading company in the crop protection sector, offering a comprehensive range of solutions, including crop protection products, bio-pesticides, bio-fertilizers, bio-stimulants, surfactants, precision agriculture tools, and drones.
We have successfully concluded a strategic acquisition deal of INR 165 crore with Bayer AG. This agreement equips Dhanuka with international manufacturing and distribution rights for two of Bayer’s fungicides, Iprovalicarb and Triadimenol. Through this acquisition, Dhanuka gains access to markets in over 20 countries across LATAM, EMEA, and Asia, including India, marking the firm’s entry into the global agrochemical market.
This acquisition is a turning point for Dhanuka as we enter the international markets with Bayer AG’s trusted brands. Our focus is on creating cost-effective crop solutions that resonate with farmers worldwide. In 2023 the revenue was 220 crores from these two fungicides, with an ambitious double-digit CAGR growth over the next five years. We are targeting an EBITDA margin of 12-15% post-integration. In FY 25, Bayer AG Will continue operations and transfer net economic benefits to Dhanuka. While in FY26 the revenue generation would start in India by Q1 and is expected to expand internationally, with full control and output by Q4.
In the future, Dhanuka is set to execute a global B2B model, collaborating with local and international market distributors while leveraging its powerful network within India. This strategic step not only strengthens Dhanuka’s global presence but also solidifies India’s position as a reliable agrochemical production centre.
Q. Could you explain the current market size of the agrochemical sector in India, detailing its growth over the past decade, and highlight the key factors driving this growth?
The agrochemical sector in India has seen significant growth due to rising population, increased demand, and shrinking arable land. These factors, coupled with crop loss due to pests, weeds, and diseases, have driven the demand for agrochemicals to boost agricultural productivity. Last year, the country’s pesticide exports reached USD 5.5 billion, making it the second-largest exporter globally, surpassing the United States, which recorded exports of USD 5.4 billion as per the data provided by the Ministry of Chemicals and Fertilizers. The domestic market was estimated at approximately ₹45,000 crore last year and is growing at a compound annual growth rate (CAGR) of 8% to 9% annually, according to industry reports.
About 15-25% of potential crop production is lost annually, highlighting the need for effective pest control and weed management. The sector is projected to grow at 8-10% annually through 2025, with a focus on sustainable practices and the use of biopesticides, which now account for 15% of the market.
Government initiatives like the promotion of crop protection products and subsidies for fertilizers further support growth. With 50% of India’s population relying on agriculture, the sector’s role in feeding a growing population remains crucial, as our country has the potential to become an international food hub.
At Dhanuka Agritech, we are focused on providing innovative agrochemical solutions and supporting farmers with the right tools and knowledge, contributing to sustainable farming and the growth of the sector. We have partnered with six Japanese companies to introduce advanced green chemistry technology to farmers for the first time in the country. After generating the necessary data in compliance with the guidelines of the Ministry of Agriculture (MoA), this technology is helping farmers manage new exotic pests that are not effectively controlled by the existing pesticides in the market.
Q. How can advanced agricultural solutions through technology, climate resilience, and sustainable practices address challenges faced by smallholder farmers, such as accessing climate finance?
At Dhanuka Agritech, we believe that India’s agricultural sector is undergoing significant transformation through upcoming advanced technologies. The challenges faced by smallholder farmers, particularly in accessing climate finance, can be overcome through the adoption of tech solutions. Precision farming optimizes resource use, reduces costs, and enhances yields. Dhanuka educates farmers about platforms that provide real-time weather, market updates, and financial help programs launched by the government for smallholder farmers. Farmers can go for Pradhan Mantri Fasal Bima Yojana (PMFBY) to cover their losses due to climate change.
Climate resilience is critical. Diversified cropping systems mitigate risks from climate variability, while investments in efficient irrigation, like drip systems, maximize water use in drought-prone regions. The adoption of climate-resilient crop varieties ensures productivity under extreme conditions. Our country receives sufficient rainfall, but 70% to 80% of it flows back into the sea through rivers. By constructing a pond in the field, proportional to the farm size, farmers can address both drought and flood situations effectively. During a drought, the stored water can be used for irrigation, and in case of floods, the pond can store excess water, thereby preventing waterlogging and contributing to the replenishment of groundwater levels.
Sustainable farming practices further strengthen smallholder agriculture. Integrated farming systems combining seasonal crops increase livestock health to get more milk and profit by using newly available technologies and increase agroforestry yields help in diversifying farmers’ incomes. Cooperative farming fosters resource pooling, reducing costs, and improving market access for smallholder farmers is also another way of getting benefits from farmers. Govt is also promoting farmers’ producer organizations (FPOs) by providing financial support. The group of farmers can go for constituting FPOs and get the advantage of working together. There are many examples of success, and few can be quoted like Amul, IFFCO, Kribhco, FPOs, Sahyadri farms, Nasik, and many more.
Q. What are Dhanuka Agritech Limited’s future plans and strategies to address the needs of smallholder farmers and expand its footprint in India and globally?
To address the needs of the smallholder farmers, Dhanuka is planning to acquire new and more sustainable but effective products. Dhanuka believes in sustainable and eco-friendly agri-inputs. Dhanuka recently acquired new fungicides and is planning to obtain more insecticides for horticulture crops and herbicides for soybean and groundnut crops. We are working on expanding our footprints into more than 20 countries in the upcoming year. Dhanuka has established a new manufacturing unit for producing key raw materials, intermediates, and technical pesticides at our new plant in Dahej, Gujarat, on 40 acres of land.
We have started a farmer training centre, Dhanuka Agritech Research and Technology Centre (DART), Palwal, Haryana, which is a state-of-the-art research and technology Centre equipped with all the latest facilities for all types of agricultural experiments. It is managed by highly qualified trained Scientists.
The facility also has an AC training hall with a capacity to accommodate 100 farmers for training. This R&D Centre facilitates the demonstration of the use of crop protection chemicals, bio-stimulants, bio-pesticides, bio-fertilizers, the latest spray technology, drone technology, precision technology, etc., on different crops. With the opening of this Centre, Dhanuka Agritech Ltd. joined the league of a few industries that have their own R&D centres to innovate, evaluate, and assess modern technologies. At DART, we have adopted villages where we are transferring seed-to-seed technology. This center was inaugurated by the Hon’ble Chief Minister of Haryana, Shri Manohar Lal Ji, in the presence of the Hon’ble Minister of State, Shri Krishan Pal Gurjar, and more than 1000 farmers. We are also providing soil and water testing facilities to the farmers at a nominal cost.
Q. How do you see the use of drones shaping the future of crop protection in India? Could you share insights on the affordability of drones?
Dhanuka has always been at the forefront of promoting drone technology in agriculture, not just recently but since 2021, as we believe that drones are shaping the future of agriculture in India.
Dhanuka has initiated conferences and summits to educate farmers on this technology. At the recent Kisan Diwas, 10 villages were adopted, and at least 200 farmers were brought together in the event. We are providing drones for spraying pesticides as well as giving demonstrations to the farmers on the right use of fertilizers and pesticides through drones. Dhanuka is also supplying the first drones approved by the DGCA for agricultural use, as well as spray services.
We take initiatives to not only share advanced farming techniques with farmers but also offer support, knowledge, and hope for a brighter, more sustainable future. It is truly inspiring to witness the engagement of these farmers, the backbone of society, with experts and their willingness to embrace new practices.
Drones, along with satellites, provide real-time data on weather patterns, soil health, and humidity, enabling farmers to make informed decisions and improve efficiency. Drones are already used in agriculture for spraying pesticides and other tasks, but they can be promoted on a larger scale through public-private partnerships.
Drone technology in agriculture includes yield improvement through better crop spray and control of insects, pests, disease, and weeds resulting in higher yields and improved quality of produce with less labor, as drones can perform tasks more quickly and efficiently than traditional methods, reducing labor costs and increasing efficiency of agri-input use.
The drone industry in India is set to take a transformative turn with emerging tech startups, along with high technology, introducing many more options to the market than are available currently. This will change the question of affordability by 2025.
Q. What key challenges and opportunities you foresee for the agrochemical sector, particularly concerning sustainable farming practices and climate resilience?
Farmers in India are troubled with extreme weather, soil degradation, and financial instability. As our farmers with traditional agricultural practices struggle to meet the demands of a growing population.
Innovations in technology, such as AI, biotechnology, and precision farming tools, offer significant opportunities to address these challenges. These innovations can help farmers manage climate risks, optimize inputs use, and improve productivity.
Technologies like soil testing, climate-resilient seeds, and digital platforms for market access are crucial for transforming farming practices and helping to increase efficiency and reduce labor costs.
Q. What is the importance of data protection in agro chemical industry? How can robust data protection measures benefit the sector and contribute to its growth?
As a signatory to the WTO, and in accordance with TRIPS Article 39.3, any sizeable investment made in generating data is protected under intellectual property rights (IPR) and must not be misused or subjected to theft. Today, developing a single new molecule involves an investment of approximately ₹3,000 crore and requires 8 to 10 years of time for research and development. Due to these enormous costs, both individuals and multinational corporations have jointly found it increasingly unviable to invest independently, leading to significant consolidations in the industry. Notable examples include Bayer-Monsanto, DuPont-Dow, Syngenta-ChemChina, FMC–Cheminova, and many other mergers.
We would like to clarify that once a patent is granted for a product; however, even if a pesticide is patented in the country where it was developed, it cannot be marketed there until extensive data is generated on various parameters as required by the Agriculture and Health Ministries of that country that examine the data, and only if they are satisfied is a product registered in the country of origin. This process involves significant investment in addition to the already substantial costs incurred in the research and development of a new molecule.
Once a product is registered in the country it has been invented, the company is required to generate data in each country where it intends to market the product, in accordance with the guidelines of the respective government authorities, which are mainly Agriculture and Health ministries.
In our country, the registration of molecules requires extensive data generation to comply with the guidelines of the Ministry of Agriculture (MoA) and Ministry of Health (MoH). This process can take between 3 to 5 years in data generation and requires an investment of approximately ₹30 to ₹40 crores. Even with our best efforts, there is a possibility that the registration may not be approved if the authorities have concerns. This could result in financial losses for the company.
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