With billions of dollars worth agrochemical patents expiring by 2020, global players keen to make the most of the situation are looking to buy or tie-up with Indian companies known for their low-cost manufacturing expertise.
At least $9 billion (about Rs 61,000 crore) worth of patents for more than 50 agrochemical products are expected to be taken off the patent list and manufacturing is likely to move to emerging markets like India.
First off the mark has been Japan. Its agrochemical firms have already begun fordging alliances with Indian firms. While Sumitomo Chemicals acquired Mumbai- based New Chemi in 2010 for an undisclosed amount, Otsuka Agritechno formed a joint venture in R&D with Insecticides IndiaBSE 3.10%. Another Japanese ISK is conducting field trials of new pesticides with United PhosphorousBSE -0.59% in India. Many Indian manufacturers are also in talks with companies from other regions and deals are likely to be announced soon.
"We see the trend," said Aditya Jhawar, an analyst with the Mumbai-based Espirito Santo Investment Bank. "Global players focus on India for two broad reasons: lower cost of production and environmental issues." He said increasing environmental issues and ban on production on certain products in some countries were pushing manufacturers to look at India, which currently exports over Rs 3,000 Crore worth of agrochemicals every year to the United States, Europe and other regions.
Another advantage that India has over other countries is that its companies offer better data protection. The Rs 13,000 Crore Indian agrochemical sector, which has been growing at 8 to 10% annually, has about 130 companies making active ingredients and intermediates. Globally, the agrochemical market size is about 45 to 47 billion dollars, with Japanese companies making up a tenth of it.
Source: Agropages (http://news.agropages.com/News/NewsDetail---10410.htm)
At least $9 billion (about Rs 61,000 crore) worth of patents for more than 50 agrochemical products are expected to be taken off the patent list and manufacturing is likely to move to emerging markets like India.
First off the mark has been Japan. Its agrochemical firms have already begun fordging alliances with Indian firms. While Sumitomo Chemicals acquired Mumbai- based New Chemi in 2010 for an undisclosed amount, Otsuka Agritechno formed a joint venture in R&D with Insecticides IndiaBSE 3.10%. Another Japanese ISK is conducting field trials of new pesticides with United PhosphorousBSE -0.59% in India. Many Indian manufacturers are also in talks with companies from other regions and deals are likely to be announced soon.
"We see the trend," said Aditya Jhawar, an analyst with the Mumbai-based Espirito Santo Investment Bank. "Global players focus on India for two broad reasons: lower cost of production and environmental issues." He said increasing environmental issues and ban on production on certain products in some countries were pushing manufacturers to look at India, which currently exports over Rs 3,000 Crore worth of agrochemicals every year to the United States, Europe and other regions.
Another advantage that India has over other countries is that its companies offer better data protection. The Rs 13,000 Crore Indian agrochemical sector, which has been growing at 8 to 10% annually, has about 130 companies making active ingredients and intermediates. Globally, the agrochemical market size is about 45 to 47 billion dollars, with Japanese companies making up a tenth of it.
Source: Agropages (http://news.agropages.com/News/NewsDetail---10410.htm)
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