diff --git a/cmd/provider/main.go b/cmd/provider/main.go
index 28a3b76..126245e 100644
--- a/cmd/provider/main.go
+++ b/cmd/provider/main.go
@@ -44,6 +44,7 @@ func main() {
 		enableManagementPolicies = app.Flag("enable-management-policies", "Enable support for Management Policies.").Default("false").Envar("ENABLE_MANAGEMENT_POLICIES").Bool()
 		maxReconcileRate         = app.Flag("max-reconcile-rate", "The global maximum rate per second at which resources may checked for drift from the desired state.").Default("10").Int()
 		pollInterval             = app.Flag("poll", "Poll interval controls how often an individual resource should be checked for drift.").Default("1m").Duration()
+		reconciliationTimeout    = app.Flag("reconciliation-timeout", "The timeout duration for the reconciliation process. In case the deadline exceeds, necessary calls to report errors will still be made.").Default("1m").Duration()
 	)
 	kingpin.MustParse(app.Parse(os.Args[1:]))
 
@@ -91,6 +92,6 @@ func main() {
 
 	kingpin.FatalIfError(err, "Cannot create controller manager")
 	kingpin.FatalIfError(apis.AddToScheme(mgr.GetScheme()), "Cannot add argocd APIs to scheme")
-	kingpin.FatalIfError(controller.Setup(mgr, o), "Cannot setup argocd controllers")
+	kingpin.FatalIfError(controller.Setup(mgr, o, *reconciliationTimeout), "Cannot setup argocd controllers")
 	kingpin.FatalIfError(mgr.Start(ctrl.SetupSignalHandler()), "Cannot start controller manager")
 }
diff --git a/pkg/controller/applications/controller.go b/pkg/controller/applications/controller.go
index e838d1d..f6f586a 100644
--- a/pkg/controller/applications/controller.go
+++ b/pkg/controller/applications/controller.go
@@ -18,6 +18,7 @@ package applications
 
 import (
 	"context"
+	"time"
 
 	"github.com/argoproj/argo-cd/v2/pkg/apiclient"
 	"github.com/argoproj/argo-cd/v2/pkg/apiclient/application"
@@ -52,7 +53,7 @@ const (
 )
 
 // SetupApplication adds a controller that reconciles applications.
-func SetupApplication(mgr ctrl.Manager, o xpcontroller.Options) error {
+func SetupApplication(mgr ctrl.Manager, o xpcontroller.Options, reconciliationTimeout time.Duration) error {
 	name := managed.ControllerName(v1alpha1.ApplicationKind)
 
 	cps := []managed.ConnectionPublisher{managed.NewAPISecretPublisher(mgr.GetClient(), mgr.GetScheme())}
@@ -64,6 +65,7 @@ func SetupApplication(mgr ctrl.Manager, o xpcontroller.Options) error {
 		managed.WithLogger(o.Logger.WithValues("controller", name)),
 		managed.WithRecorder(event.NewAPIRecorder(mgr.GetEventRecorderFor(name))),
 		managed.WithConnectionPublishers(cps...),
+		managed.WithTimeout(reconciliationTimeout),
 	}
 
 	if o.Features.Enabled(features.EnableBetaManagementPolicies) {
diff --git a/pkg/controller/argocd.go b/pkg/controller/argocd.go
index c689bc6..bd40524 100644
--- a/pkg/controller/argocd.go
+++ b/pkg/controller/argocd.go
@@ -19,6 +19,7 @@ package controller
 import (
 	xpcontroller "github.com/crossplane/crossplane-runtime/pkg/controller"
 	ctrl "sigs.k8s.io/controller-runtime"
+	"time"
 
 	"github.com/crossplane-contrib/provider-argocd/pkg/controller/applications"
 	"github.com/crossplane-contrib/provider-argocd/pkg/controller/applicationsets"
@@ -30,13 +31,17 @@ import (
 
 // Setup creates all argocd API controllers with the supplied logger and adds
 // them to the supplied manager.
-func Setup(mgr ctrl.Manager, o xpcontroller.Options) error {
+func Setup(mgr ctrl.Manager, o xpcontroller.Options, reconciliationTimeout time.Duration) error {
+	setupApplicationWithTimeout := func(mgr ctrl.Manager, o xpcontroller.Options) error {
+		return applications.SetupApplication(mgr, o, reconciliationTimeout)
+	}
+
 	for _, setup := range []func(ctrl.Manager, xpcontroller.Options) error{
 		config.Setup,
 		repositories.SetupRepository,
 		projects.SetupProject,
 		cluster.SetupCluster,
-		applications.SetupApplication,
+		setupApplicationWithTimeout,
 		applicationsets.SetupApplicationSet,
 	} {
 		if err := setup(mgr, o); err != nil {