PMFAI opposes the Draft Order to ban 27 Insecticides

23rd May 2020, New Delhi:
The Government on 14th May 2020, released a draft order proposing to ban a list of 27 insecticides. The reason for the proposed ban in the draft order stated that the molecules pose a risk to human beings and animals.

The draft order mentioned that the proposed ban will be considered after the expiry of a period of 45 days from the date on which the copies of the Gazette of India containing the order are made available to the public.

The order also stated that any objections or suggestions received within this period of 45 days will be considered by the Central Government.

Mr. Pradip Dave – President of PMFAI (Pesticides Manufacturers & Formulators Association of India, representing India’s Pesticide Manufacturers, Formulators, and Traders) elaborated on the draft order to help understand the impact of the proposed ban on 27 insecticides.

He mentioned, “In 2013, Verma Committee had placed 66 products from generic pesticides under review. Out of these 66 products, 34 were shortlisted, of which 9 were banned in 2019. Of the balance, data was collected by the Government of India on 27 products from manufacturers in an amicable way, and hence the gazette which came out was a shock to the industry.”

“These generic products proposed to be banned have a market size of 40-50bn INR and have been used for the last 3-4 decades by Indian farmers without any complaints unless misused. Indian manufacturers have been supplying these products worth 35bn INR to the domestic market, and the balance is exported.”

Indian Industry and the Proposed Ban

Talking about the Indian industry and the proposed ban, he said, “The Indian Pesticide industry is worth over 400bn INR, of which domestic consumption is 180bn INR, with the balance being exported from India. MNCs are unable to gain market share in the Indian market, and hence the gazette is likely a conspiracy by MNCs to bring readymade imported pesticide formulations into the country.”

“Many MNC products are being held up because of the domestic industry’s suitable pricing and high quality. The price of replacement products will be 3-6X higher than existing Indian products. This will be an added burden on Indian farmers. Many organophosphorus compounds cost Rs 500/ ltr, which will be replaced with imports that are far more expensive.”

“Similar situations have occurred in the past where the industry opted for legal recourse. PMFAI (representing India’s Pesticide Manufacturers, Formulators, and Traders) will be making a presentation to the ministry and asking the court for relief.”

Proposed Ban is Only on Manufacture & Use in India, While Export Can Continue

Most local manufacturers who may be barred from manufacturing and selling in the domestic market can hedge their risk through export registrations. A local manufacturer who has export registrations (or can obtain one) can continue exporting. However, they also require product registration in the country of import. For example, Endosulfan, which is banned in India, can be manufactured and exported upon obtaining registration and a license from the government.

“Within 45 days of the gazette, the industry has to make a representation which, if ignored, they can opt for legal recourse. Last time when a representation was made, 9 molecules were banned out of a list of 34 molecules. Typically, bans are enforced in a phased manner globally.”

Mr. Dave added, “India is the largest manufacturer of Mancozeb (500,000 MTPA) and Chlorpyrifos. This proposed ban is not going to result in any incremental investment by MNCs in India.”

The timing of the gazette is precarious in nature given the uncertainty and preoccupation with the Covid-19 crisis in the country. Without any findings being disclosed to the industry, the proposed ban is both shocking and unfair. Furthermore, it is contradictory to the spirit of “Atmanirbhar” and the “Make in India” initiative that the government has been promoting.