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