Budget 2026: Rebuilding cotton’s innovation pipeline - research must be the centre of policymaking

By Dr. M. RamasamiCotton occupies a critical place in India’s agricultural and industrial economy. It supports millions of farm households, feeds a globally competitive textile sector, and remains one of the country’s most widely cultivated commercial crops.

Yet, despite this significance, cotton today faces a paradox; while production continues at scale, productivity gains have stagnated and cultivation risks have intensified.Though cotton anchors India’s agrarian economy, yet faces a critical paradox: while production scale remains vast, productivity has stagnated and farming risks have intensified. This stagnation mirrors a broader national challenge.

With India’s R&D intensity hovering at just about 0.7% of GDP, long-gestation crops like cotton lack the deep, continuous investment required to sustain innovation pipelines.While India remains a top global producer, yields have flatlined amidst escalating pest and climate pressures. The defining crisis is the absence of new technology - earlier scientific gains have faded, leaving farmers to battle modern field realities with ageing, inadequate tools.

Mechanization: the non-negotiable necessityOne of the clearest manifestations of this strain is visible in the economics of cotton harvesting. Unlike many other crops, cotton is harvested manually, often through multiple pickings across the season. Picking alone can account for roughly 30–35% of total cultivation costs, making labour the single largest cost component in cotton production.This dependence on manual labour is becoming untenable. Labour scarcity during peak season especially, picking pushes costs higher, creates uncertainty, and impacts farmers' margins.

In several regions, timely availability of pickers has become as critical a risk as pests or weather - making mechanisation an absolute necessity, not a choice. But mechanisation cannot succeed with developing machines alone. Cotton plants must be specifically bred for machine compatibility - uniform architecture, synchronized boll opening, appropriate height, and so on. Developing such machinery-ready hybrids demands focused, investment-heavy R&D programs with enormous scientific, technical, and economic challenges.In this context, is why weighted tax deduction on R&D expenditure is essential. It would unlock sustained private investment, accelerate development of mechanisation-suited varieties, and reduce farmers' exposure to labour shocks while improving competitiveness and profitability.Further, a key bottleneck is trash content: machine-harvested kapas often carries 8–12% extraneous matter, compared to much lower levels in manual picking, while markets typically accept cotton with trash below about 2%.

Without addressing this gap, mechanization may not help despite reducing dependence on manual labour. Field-level pre-cleaning technologies are therefore essential, enabling farmers to lower trash content at the farm gate and ensure that mechanization strengthens, rather than weakens, farm incomes.Thus, to ensure India’s cotton sector remains competitive, addressing these challenges such as pest resistance, climate resilience, or mechanization, requires sustained, long-term research commitment by the companies.

This requires science-based, stable and predictable policy and regulatory frameworks. Cotton innovation involves multi-year trials, validation across regions, and coordination between breeders, engineers, agronomists, and regulators. Here, the issue of ease of research becomes central. When research pathways are unpredictable or approvals are prolonged, timelines stretch and costs escalate. Long-gestation research becomes harder to justify, particularly in a national context where overall R&D intensity is already constrained.

The result is not a lack of ideas, but a thinning of serious, sustained research efforts precisely where they are most needed.Why Budget 2026 mattersAs India approaches Union Budget 2026, cotton offers a clear illustration of why agricultural research must be treated as strategic infrastructure rather than discretionary spending. Short-term measures, input support, procurement, or relief interventions, play an important role in stabilizing farm incomes.

However, they cannot resolve productivity plateaus or structural cost pressures rooted in technological gaps.

Those require patient investment in science. At this crucial juncture, two long-standing policy measures warrant immediate attention and swift action. First, the restoration of the 200% weighted tax deduction on R&D expenditure. Agricultural research involves high upfront costs, long timelines, and uncertain outcomes.

Weighted tax incentives acknowledge this reality and help sustain investment in problem-solving science, particularly in crops like cotton where innovation cycles are inherently long.Second, GST rationalization for seeds. Seeds are the foundation of productivity, yet their current tax treatment adds avoidable cost to an essential input. Rationalization would ease the burden on farmers while improving liquidity for seed developers, indirectly strengthening the research-to-farm continuum.

These measures are not demands in isolation; they are enabling signals that align fiscal policy with the realities of agricultural innovation.From managing risk to enabling resilienceCotton research is ultimately farm-level risk management. When innovation pipelines slow, farmers are forced into higher input use, delayed operations, and greater exposure to labour and market shocks. When science delivers on time, better pest solutions, mechanization-ready hybrids, or improved pre-cleaning—farmers gain stability and predictability.Cotton’s future will be determined less by acreage and more by how effectively seed research helps ensure raw material security for the textile sector in the wake of fast changing economic, ecological and geopolitical realities. Union Budget 2026 is a decisive opportunity: strengthen R&D incentives, rationalize input taxation, and make ease of doing research a policy priority to rebuilding the cotton innovation pipeline.That would reaffirm a simple truth: sustainable agriculture is built not on short-term fixes, but on long-term investment in science that helps farmers cope, compete, and endure.(The author is the former Chairman, Federation of Seed Industry of India and Chairman, Rasi Seeds (P) Ltd)