India's Specialty Fertilizer Industry Faces Regulatory Shake-Up as Biostimulants Come Under Government Control

New Delhi, September 1 – The country’s specialty fertilizer sector is poised to enter a period of turbulent transition following the government’s decision to bring biostimulants under regulatory control and oversight earlier this year. The overall compliance costs are expected to rise significantly, effectively forcing many small and medium-sized manufacturers out of business. The specialty fertilizer sector includes the production of highly efficient nutrient products developed for specific soil and crop conditions, which differ from conventional bulk fertilizers.

The amendment to the Fertilizer Control Order (FCO) in February 2025 marks the first time direct regulatory control of biostimulants, listing them alongside soluble and organic fertilizers and micronutrients, which have been subject to government regulations for a long period.

Compliance Burden Hits Small Players

Rajib Chakraborty, President of the Soluble Fertilizer Industry Association (SFIA), said the sector was unprepared for the regulatory framework and is now grappling with high investment requirements. He also asserted that the move will affect the small enterprises the most.

“The industry is not fully ready to adopt the new regulations. Many SMEs that are operating will be wiped out in the process,” Chakraborty cautioned.

He also highlighted some of the critical factors, such as a lack of skilled human resources, limited facilities, and inadequate digitalisation, due to which only a few biostimulant products in the market (out of thousands used in the sector) have cleared the official tests conducted by ICAR (Indian Council of Agricultural Research)-listed universities.

No Ban, but Stricter Approval Process

There has been ambiguity regarding the report of the biostimulant ban in the past few weeks. However, Chakraborty underlined that the agriculture minister’s outlook has been grossly misinterpreted: “What the minister is saying is linking biostimulants with subsidized fertilizer. He is asking to bring the specification to FCO and then allowing one by one to produce and sell,” he explained.

Industry Growth Remains Strong

The sector continues to grow at a CAGR of 18% as the demand for specialty fertilizers is on the rise in India. SFIA (Soluble Fertilizer Industry Association) members are currently focused on improving farmer education and promoting products based on cost-benefit analysis rather than forced bundling.

The association is also collaborating with research institutions to generate scientific validation for SOMS (soluble organic micronutrients and stimulants). A recent study with the National Research Centre for Grapes demonstrated positive results for specialty fertilizer technologies.

Technology to Drive the Next Phase

Looking ahead, the sector is investing in advanced solutions, including nano fertilizers and digital agriculture. Specialty fertilizers are already being integrated into precision farming practices, serving as carriers for drone-based applications and supporting drip irrigation systems.

“Farmers are getting analytical labs in their own place. They are getting weather monitoring systems in their own place,” Chakraborty noted, pointing to rising technology adoption.

Transition Period Ahead

The next 3-4 years will be critical for the sector to comply with biostimulant regulations fully. The process is expected to undergo significant changes as the industry adapts to the new regulatory landscape, ensuring continued growth and reduced dependence on imports to meet domestic demand.

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