Tata Strate­gic re­port: Chem­i­cals mar­ket in In­dia to grow from $155 Bn in FY16 to $346 Bn by FY25

Chemical Industry Digest - - News & Views -

Tata

Strate­gic Man­age­ment Group, on Septem­ber 21st 2017, pre­sented a re­port ti­tled ‘In­dia Chem Gu­jarat 2017’ on In­dian chem­i­cals in­dus­try, as knowl­edge and strat­egy part­ner for the FICCI or­gan­ised In­dian Chem Gu­jarat Con­clave 2017.

To­day the In­dian chem­i­cal in­dus­try, at a do­mes­tic in­dus­try size of USD 155 bil­lion, ac­counts for only 3.4% of the global chem­i­cal mar­ket. It is highly di­ver­si­fied with more than 80,000 chem­i­cals and is di­rectly/in­di­rectly re­lated to al­most all the sec­tors mak­ing it very cru­cial for the eco­nomic de­vel­op­ment of the coun­try. The re­port out­lines the de­mand sce­nario till 2025 and also the key growth driv­ers.

The re­port also high­lights crit­i­cal is­sues the chem­i­cal in­dus­try is fac­ing to­day like avail­abil­ity of key feed­stock, in­fra­struc­ture sta­tus, scale of op­er­a­tions, and ac­cess to tech­nol­ogy, en­ergy se­cu­rity and ease of do­ing busi­ness. These is­sues have ham­pered in­dus­try growth and it needs Govern­ment in­ter­ven­tions to achieve its true potential. Adop­tions of al­ter­nate feed­stock, in­creas­ing in­vest­ment in R&D and achiev­ing scale through col­lab­o­ra­tion are some of the key levers in­dus­try can act upon to over­come these chal­lenges.

The spe­cial fea­ture on Gu­jarat il­lus­trates the ad­van­tages it offers. The chem­i­cal in­dus­try is to­day the larg- est and fastest grow­ing com­po­nent of Gu­jarat’s man­u­fac­tur­ing sec­tor. Gu­jarat as a state con­trib­utes a ma­jor share of the coun­try’s chem­i­cals out­put: 63% of petro­chem­i­cals, 53% of chem­i­cals and 45% of phar­ma­ceu­ti­cals.

This re­port in­cludes a spe­cial sec­tion on ‘mak­ing In­dia the in­vest­ment mag­net for chem­i­cals: Strate­gic Im­per­a­tives’. This sec­tion states that im­prov­ing on EODB, in­te­gra­tion of chem­i­cal & petro­chem­i­cal sec­tor, iden­ti­fy­ing strate­gic prod­ucts of our in­ter­est, defin­ing con­sumer stan­dards and build­ing the right non­tar­iff bar­ri­ers will be cru­cial for In­dia to re­al­ize its as­pi­ra­tion of be­ing the 4th largest chem­i­cal man­u­fac­turer in the world.

Com­ment­ing on the re­port, Mr. Mo­dan Saha, Chief Ex­ec­u­tive Of­fi­cer, Tata Strate­gic Man­age­ment Group said, “In­dian chem­i­cal in­dus­try is on the cusp of a growth tra­jec­tory. This in­dus­try should be looked at as a part of In­dian eco­nomic growth story. In­dia’s na­tional man­u­fac­tur­ing pol­icy aims to en­hance the share of man­u­fac­tur­ing in the coun­try’s GDP to 25%, and cre­ate 100 mil­lion jobs by 2022, and the chem­i­cal in­dus­try would have a very im­por­tant role in this”.

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