Agricultural research and innovation has been a major source of agricultural growth in developing countries. Unlike most research on agricultural research and innovation which concentrated on the role of government research institutes and the international agricultural research centers of the Consultative Group for International Agricultural Research, this paper focuses on private sector research and innovation. It measures private research and innovation in India where agribusiness is making major investments in research and producing innovations that are extremely important to farmers.

Agricultural research continues to be a good investment. The studies show that investments in international and national agricultural research account for almost all of the total factor productivity (TFP) growth in SSA and large shares of agricultural growth globally. The existing agricultural research institutions have, on average, delivered rates of return to public investment above 30-40%, which is much higher than the 5-10% available to other public investments or the 2-5% cost of borrowing public funds.