Budget 2025: Sops in works for organic farming to double exports

New Delhi: The government is considering incentives for organic production and natural farming as it aims to double organic exports amid export restrictions on farm products and strict pesticide residue norms, called maximum residue limits (MRL), in developed markets.

Talks are on to give incentives to cover likely losses incurred by the farmers involved in organic farming and an announcement could be made in the upcoming budget, officials said. Finance minister Nirmala Sitharaman will present the budget for 2025-26 next month.

The exercise is part of the rework of the 2018 Agriculture Export Policy that had aimed at $60 billion agri exports by 2022 and $100 billion thereafter but the target remains unachieved with India's overall farm exports expected to cross only $50 billion in FY25.

"Fertiliser prices are rising and there are concerns related to MRL and health issues. Discussions are going on if new incentives can be given to cover the initial loss incurred in natural and organic farming," said an official.

The traces pesticides leave in treated products are called residues and MRL is the highest level of a pesticide residue that is legally tolerated in food or feed.

India's exports of spices, basmati rice, chillies, tea and sesame seeds are subject to MRLs. There have been instances of high levels of thiamethoxam (an insecticide) and tricyclazole (a fungicide) in basmati rice, salmonella in chili powder and onion powder, and unauthorised colour in turmeric being found in food products.

The country has made a strong pitch at WTO for formulation of guidelines to determine default MRL in the absence of international standards, else these requirements become trade-restrictive and act as non-tariff barriers to international trade, disproportionately affecting exporters from developing countries.

India aims to double its organic product exports to $1 billion in FY26 and grab a higher share of global organic exports, which are estimated around $147 billion annually.