EU’s new SPS threaten Assam’s tea exports

This article is authored by Ankur Aggarwal, chairman, CropLife India and executive chairman & managing director, Crystal Crop Protection Ltd.

From March 7, 2026, the European Union (EU) has begun to apply tighter residue limits on certain neonicotinoid insecticides such as thiamethoxam and clothianidin that are widely used in tea cultivation. This move now threatens around 40 million kg (worth $ 145 million) trade. This comes even as India has recently signed a new Free Trade Agreement with the EU. While the new deal paves way for preferential market access through tariff concessions for several agricultural products from India, it does not shield our farmers and exporters from the increasingly stringent sanitary and phytosanitary standards (SPS) being applied across EU, effectively acting as a non-tariff barrier.

Tea plantation (Unsplash)

Under its stated ambitions to reduce pesticide use and associated risks the EU has steadily tightened its approach to agricultural imports in the last couple of years, including lowering maximum residue limits for several pesticides. Where no specific limit exists, it applies a default threshold of 0.01 mg per kg, effectively creating a near zero tolerance level for residues in food entering its market.

Indian agricultural exports have already begun to feel the heat from these tightening standards. The EU’s decision to reduce the allowable residue limit for tricyclazole in rice from 1.0 mg per kilogram to 0.01 mg per kg has led to heightened scrutiny and rejections of basmati rice consignments at European borders. This is significant considering that India exported about 6.06 million tonnes of basmati rice worth over ₹50,000 crore in 2024–25, with Europe representing one of its most valuable premium markets. Similar pressures are now emerging across other high-value export commodities such as tea, spices and grapes.

Indian farmers today continue to depend heavily on crop protection molecules introduced three to four decades ago. Repeated reliance on the same chemistries often leads to the development of pest resistance, which in turn results in more frequent spraying. This makes it increasingly difficult for farmers to align with tightening global residue standards. Many of these older molecules also require higher application doses compared to modern formulations and several have already been phased out in other major agricultural economies.

For India, addressing this challenge requires more than cosmetic measures such as tighter export testing. What is needed is a stronger domestic regulatory ecosystem that encourages innovation and facilitates the timely introduction of newer, safer and more effective crop protection technologies, enabling Indian agriculture to keep pace with evolving global standards.

One policy instrument that can help achieve this is Protection of Regulatory Data (PRD). In simple terms, PRD protects the scientific safety and efficacy data submitted by the first registrant of a crop protection product from unfair commercial use for a limited period. Importantly, it does not prevent other companies from registering similar products if they generate their own data independently. Rather, it ensures that the significant investment required to generate the original data package is not immediately appropriated by competitors without comparable effort.

At present, the Insecticides Act of 1968, which continues to govern pesticide regulation in India, does not provide such protection. Even the proposed Draft Pesticides Management Bill, 2025, which seeks to modernise India’s regulatory architecture, does not incorporate it. As a result, companies that invest substantial time and resources in introducing new molecules face the risk that competitors can rely on the same data for “me-too” registrations soon after the first approval. Over time, this has acted as a significant disincentive for the crop protection industry to refresh its product portfolio in India with newer technologies.

Registering a new crop protection molecule requires extensive studies on toxicity, environmental safety, residue behaviour and field efficacy under local conditions. Generating this data can take six to eight years and cost upwards of ₹40–50 crore. Without a mechanism that protects this investment for a reasonable period, innovators often hesitate to prioritise India for the introduction of advanced technologies.

The need for PRD has been recognised for years. The Satwant Reddy Committee recommended limited protection for agrochemical regulatory data as early as 2007. The Parliamentary Standing Committee on Agriculture has also supported extending such protection to encourage the introduction of newer molecules. In 2018, the Committee on Doubling Farmers’ Income noted that India’s relatively small pool of registered crop protection molecules restricts farmers’ ability to adopt modern pest management practices. Yet despite these repeated recommendations, India’s regulatory framework continues to operate without such protection.

This gap carries broader implications. As the EU and other major markets continue tightening SPS and residue standards, India’s ability to sustain agricultural exports to premium markets will increasingly depend on how quickly its production systems adapt.

Strengthening is, therefore, essential. Farmers require access to new technologies that are more selective, require lower application doses and integrate better with modern pest management strategies. PRD can serve as an important policy instrument to encourage the timely introduction of such technologies.

Without credible incentives for innovation, India risks asking its farmers to meet tomorrow’s global standards with yesterday’s crop protection toolkit.

This article is authored by Ankur Aggarwal, chairman, CropLife India and executive chairman & managing director, Crystal Crop Protection Ltd.