SECTORS AT THE INDIA PAVILION

Petrochemicals

CATALYZING GROWTH
India Is Currently The 6th Largest Producer Of Chemicals In The World By Sales.

Stands at US$ 180 billion in market value

Investments worth US$ 24.68 billion been made

Expected to raise to US$ 117.42 billion

Total Major Chemicals and Petrochemicals production in 2019-20 was nearly 14,000 Million tons

More than 2 million people derive their livelihood from the Indian chemical industry

Significant government initiatives to stimulate growth in this sector include:

  • 100% Foreign Direct Investment (FDI) is allowed under the automatic trade route in the chemicals sector.
  • Centres of Excellence will help focus on Innovation and R&D to support movement up the value chain from bulk to value-added chemicals. Furthermore, investment allowances, tax deductions on plant and machinery acquisition and additional incentives are being offered for the industry sponsored R&D initiatives.
  • The Plastic Parks Scheme with state-of-the-art infrastructure and common facilities ensures Government seed support of up to 50% of project cost with a ceiling limit of US$ 5.97 million per project. 10 such parks have been approved by the Central government and will be followed by 8 more in due course of time.
  • Ministries of each sub-sector are setting up Project Development Cells (PDCs) to encourage investments for infrastructure and employment as per their respective projected requirements.
  • The Government of India has approved 4 Petroleum, Chemical and Petrochemical Investment Regions (PCPIRs) in Visakhapatnam, Dahej, Paradeep, Cuddalore and Naghapattinam to promote investment and industrial development. Each PCPIR has been allotted a developmental area of about 250 sq. km. Investments worth US$ 24.68 billion have already been secured and the PCPIRs are further expected to raise US$ 117.42 billion.

Several industry stakeholders have recognized the importance of investing in the sector, as can be seen below:

  • Asian Paints has planned to invest US$ 300.63 million and build the world’s largest paint manufacturing plant at Mysore, Karnataka. The new Asian Paints the plant will have a capacity of 600,000 kilolitres per annum, employing 900 people directly and 4,500 people indirectly.
  • ONGC Mangalore Petrochemicals (OMPL) plans to raise US$ 510 million through a foreign currency term loan, maturing July 2027, with a moratorium of three years for repayment.
  • With an upgraded capacity of 1.24 million barrels (197,000 m3) of oil per day, the Jamnagar Refinery owned by Reliance Industries Limited, is currently the largest refinery in the world.
  • By refocusing polymer production on export markets post the COVID-19 pandemic, Reliance Industries Limited, with the help of the Maersk shipping and logistics group have quadrupled exports from the Jamnagar Refinery to over 10,000 x 40’ containers.
  • IOCL, BPCL and HPCL - are joining hands to build the world’s largest Integrated Refinery and Petrochemicals Complex near Ratnagiri, Maharashtra.
  • The production of Total Major Chemicals and Petrochemicals in 2019-20 were nearly 14,000 Million tons.

Backed by government and Incubator support programmes, Indian startups are overcoming infrastructure barriers to commercialise groundbreaking research.

India is projected to contribute to more than 10 percent of the incremental global growth in petrochemicals over the next decade. Given its significant import dependence, the country may need more than 15 world-scale petrochemicals assets by 2035 to meet domestic demand. Capacity building measures and sustained institutional support has been an important factor in the development of the industry and will remain so in days to come.