Stepping up research and development (R&D) — from less than 0.5% to at least 1% of the gross value added (GVA) of India’s agricultural sector — is imperative to realise the government’s aims in prioritising the sector as a first engine of growth. The farm economy is expected to grow by 5% per annum, higher than current levels of 3%, for India to become a developed nation by 2047. The bang for the R&D buck surpasses the returns from all other activities relating to farming. In 2024, a working paper of the National Institute of Agricultural Economics and Policy Research — that operates under the Indian Council of Agriculture Research (ICAR) — estimated that a rupee in R&D yields a return of Rs 13.85. Every rupee of agri-R&D yields better returns than a rupee spent on food and fertiliser subsidies.
ICAR’s director general, ML Jat, has gone further in reportedly arguing that agri-R&D was responsible for a third of the rise of the country’s agricultural GVA. This works out to Rs 55,000 crore out of the total value of output increase of Rs 1.7 lakh crore in 2025-26 over 2024-25. This was attributed to higher-yielding seeds, better mechanisation, improved germplasm for horticultural crops, etc. The total gain was apportioned into three equal components, notably R&D, government policies and development programmes, and farmers’ efforts. According to the director general, agri-R&D deserves at least one-third of the credit as higher investments or greater farmer efforts by themselves would not deliver comparable productivity gains. This informed estimate was intended to illustrate gains that ensue from public agricultural research.
R&D also contributes to making agriculture more climate-smart and sustainable. In this regard, the good news is that research-intensive agribusiness conglomerates are addressing such challenges. ITC is scaling up its climate-smart agriculture (CSA) initiative that includes region-specific practices to minimise the impact of heatwaves and unseasonal heavy rains, introduction of heat-tolerant varieties, dry land agricultural practices such as broad bed and furrow system, mulching, reducing water use (more crop per drop), and use of heat-ameliorating sprays. This initiative covers 3.2 million acres across 17 states benefitting 1.2 million farmers. CSA practices in rice and wheat have reduced cost by over 20%, improved yields by around 10%, and enhanced net returns by over 23% compared to conventional practices, according to Sanjiv Puri, ITC chairman and managing director, in his address to the 115th annual general body meeting.
The heavy-lifting on agri-R&D, however, will have to be done by the government which can serve to crowd in efforts of the private sector. The agriculture ministry has two departments — one for agriculture and farmers’ welfare, and the department of agricultural research and education (DARE). The ruling dispensation must walk the talk by boosting agri-R&D to unleash productive forces which ensure that growth in the sector accelerates to 5%. Agricultural economists like Ashok Gulati have in fact forcefully underscored the need to double the budgeted spend on DARE which received an allocation of `9,967 crore in Budget 2026, that is less by 3% than the revised estimate for Budget 2025. There is also extremely meagre spending on extension services when compared to the global average. Given the substantive contribution of R&D in driving the incremental increase in agri-GVA, the upshot is that it must be stepped up as an overriding national priority.