The government had previously offered a 200% weighted income tax deduction on private R&D investments, but this was reduced to 100% from 2020-21. Private seed firms, which invest heavily in research – often over 10% of their annual revenue -have argued that enhanced incentives are needed to sustain innovation and ensure long-term productivity gains in the agriculture sector. It has also requested for regulatory harmonisation across states to enhance ease of doing business.
The ongoing crisis has caused a significant spike in input costs including energy, packaging, and distribution causing operational and financial stress, said Raghavan Sampathkumar, executive director, Federation of Seed Industry of India (FSII), adding that policy reforms and incentives can help save an estimated ₹800 crore annually and much of it can be ploughed back in R&D.