Market Reports

Chemical & Petrochemical Industry in India

1	Quick facts: Indian Chemical & Petrochemical Industry
2	Overview: India’s Chemical & Petrochemical Sector
3	Top Chemical & Petrochemical Companies in India
4	Government Initiatives
5	Mega Trends in Chemical & Petrochemical sector
6	Why India for Investment in Chemical & Petrochemical?

Quick Facts: Indian Chemical & Petrochemical Industry

India is the 6th largest producer of chemicals in the world and the 3rd largest in Asia, contributing 7% to the country’s GDP
The chemical and petrochemical industry in India employs over 2 million people and produces more than 80,000 different chemicals and petrochemicals
About 70% of India’s chemical production is used within the country
India contributes to 2.5% of global chemical sales
On the global stage, India holds a strong position in the trade of chemicals, ranking 14th in exports and 8th in imports (excluding pharmaceuticals)
India has a significant global presence, exporting chemicals to more than 90 countries, especially in the areas of dyes, pharmaceuticals, and agrochemicals
In India’s chemical sector, industrial licensing is allowed, and 100% foreign direct investment (FDI) is permitted under the automatic route, with exceptions for certain hazardous chemicals
In FY24, the chemical sector received INR 73.9 billion in foreign direct investment (FDI)
India ranks as the 4th largest producer of agrochemicals worldwide, following the United States, Japan, and China
By 2025, the specialty chemicals market in India is projected to reach INR 5,604 billion
India is a major global supplier of dyes, producing around 16% of the world’s dyestuffs and dye intermediates
By 2025, India’s chemicals and petrochemicals sector is estimated to attract an investment of INR 9,402 billion
Under the Interim Union Budget 2024-25, the government allocated INR 2,025 billion to the Department of Chemicals and Petrochemicals

Overview: India’s Chemical & Petrochemical Sector

The Indian chemical industry is a highly diverse sector, offering over 80,000 commercial products, which can be broadly divided into categories like bulk chemicals, specialty chemicals, agrochemicals, petrochemicals, polymers, and fertilizers. Valued at INR 19.2 trillion, it is projected to grow to INR 26.2 trillion by 2030 and reach INR 87.5 trillion by 2040.
The Indian government has shown support for this sector by allocating INR 2 billion to the Department of Chemicals and Petrochemicals in the Interim Union Budget 2024-25.
Between April 2023 and March 2024, India’s dye exports amounted to INR 203 billion. Key export markets include Germany, the UK, the US, Switzerland, Spain, Turkey, Singapore, and Japan. Additionally, disruptions in supply chains from China, coupled with plant closures in the EU and China due to environmental regulations, have provided Indian manufacturers with opportunities to expand their investments in specialty chemicals.

Top Chemical & Petrochemical Companies in India

Tata Chemicals Limited
Tata Chemicals Limited is a global company with a focus on both Basic Chemistry Products and Specialty Chemistry Products.
Its Basic Chemistry product line supplies essential ingredients to some of the world’s largest manufacturers of glass, detergents, and other industrial goods.
Gujarat Fluorochemicals Limited
GFL is an Indian chemical company with more than 30 years of experience in fluorine chemistry.
The company specializes in fluoropolymers, fluorospecialties, refrigerants, and chemicals, meeting the material needs of the modern world.
BASF India Ltd.
BASF India Ltd is one of the top players in the Indian chemical market and a subsidiary of the German-based BASF, the largest chemical company in the world.
It operates in over 80 countries. The company manufactures a wide range of products, including agriculture chemicals, leather chemicals, Styropor, tanning agents, and other chemical products.
Pidilite Industries Ltd.
Pidilite is a leading producer of industrial adhesives, pigments, bonding and waterproofing solutions, paints, as well as textile and leather chemicals.
The company’s innovations are driven by three fully equipped R&D centers in India, along with two subsidiary R&D centers in Baroda (R&D ICA) and Kishangarh (R&D Groupopuma), and a state-of-the-art technical and research center in Singapore.
Gujarat Heavy Industries Chemicals Limited
The company is the largest manufacturer of soda ash at a single location in the country.
The soda ash produced is utilized in the manufacturing of glass, detergents, and other industrial products. It also serves as a crucial raw material for solar glass and lithium-ion batteries.

Government Initiatives

India Chem 2024
The 13th edition of “India Chem 2024,” organized by the Department of Chemicals and Petrochemicals under the CPDS Scheme, was a key event for the chemical and petrochemical industries in the Asia-Pacific region.
It highlighted growth opportunities in India’s chemical sector and showcased government initiatives for sustainable development. The event hosted 172 exhibitors, including 49 international participants, and attracted global leaders, with 78 CEOs, 135 speakers, and 689 international delegates.
The Netherlands was the Partner Country, and several Indian states, including Gujarat, Odisha, and others, were Partner States.

Petroleum, Chemicals and Petrochemical Investment Regions (PCPIRs)
Under the PCPIR Policy introduced in 2007, four Petroleum, Chemical, and Petrochemical Investment Regions (PCPIRs) were established in Andhra Pradesh (Vishakhapatnam), Gujarat (Dahej), Odisha (Paradeep), and Tamil Nadu (Cuddalore and Nagapattinam) to drive investment and industrial growth.
The updated PCPIR Policy 2020-35 aims to attract investments of INR 12.4 trillion by 2025, INR 18.6 trillion by 2030, and INR 24.8 trillion by 2035.
The regions focus on scaling up the petroleum, chemical, and petrochemical industries while ensuring environmental sustainability, generating an estimated 33.8 lakh jobs. By 2035, the initiative is projected to attract INR 24 trillion in investments.

2034 Vision for Chemicals
The government has outlined a vision for the chemicals and petrochemicals sector by 2034, aiming to enhance domestic production, reduce reliance on imports, and attract greater investment.
As part of this strategy, the government intends to introduce a PLI scheme offering 10-20% incentives for the agrochemical sector.
This initiative is designed to foster the development of a comprehensive manufacturing ecosystem by promoting the growth of industrial clusters.

Chemicals Promotion Development Scheme (CPDS)
CPDS aims to support and advance the chemical and petrochemical industries by offering financial assistance for activities such as seminars, conferences, exhibitions, as well as conducting studies, and consultancies, and addressing key challenges impacting these sectors.

In addition to the policies enacted by the Department of Chemical & Petrochemical, state government incentives play a crucial role in attracting investments to their regions.

Mega Trends in Chemical & Petrochemical Sector

Sustainability and Green Chemistry
Eco-friendly Products: Increasing demand for biodegradable and sustainable chemicals
Circular Economy: Focus on recycling and reducing waste through efficient processes
Carbon Footprint Reduction: Companies are investing in energy-efficient production methods and low-emission technologies
Green Petrochemicals: Development of bio-based feedstocks for petrochemical production
Digital Transformation and Industry 4.0
Automation and AI: Widespread adoption of AI, IoT, and robotics for process optimization and predictive maintenance
Data Analytics: Enhanced decision-making through real-time data analytics for performance and supply chain management
Smart Manufacturing: Introduction of smart factories for better quality control and operational efficiency
Blockchain: Use of blockchain for improved traceability, transparency, and supply chain security
Increasing Demand for Specialty Chemicals
Industrial Growth: Expansion of manufacturing sectors like automotive, electronics, and construction driving the demand
Performance Chemicals: High growth in demand for chemicals with specific functionalities, such as additives, coatings, and polymers
Agricultural Chemicals: Rise in demand for fertilizers, pesticides, and crop protection chemicals due to agriculture’s growing role
Consumer Goods: Increasing use of chemicals in consumer products like cosmetics, cleaning agents, and food additives
Integration of Renewable Energy in Chemical Production
Renewable Feedstocks: Shift toward using renewable energy sources such as solar and wind for chemical production
Power-to-X Technologies: Integration of electrochemical processes (like Power-to-Liquid) to produce sustainable chemicals
Energy Efficiency: Emphasis on renewable energy-based processes for reducing dependence on fossil fuels in petrochemical production
Carbon Capture and Utilization: Adoption of carbon capture technologies in the chemical industry to mitigate emissions

Why India for Investment in Chemical & Petrochemical

Strong Domestic Market Demand
Growing Industrial Base: India is one of the world’s fastest-growing major economies, with the chemical and petrochemical sectors benefiting from industrialization across multiple sectors like automotive, construction, agriculture, and pharmaceuticals
Chemical Consumption: India’s chemical consumption is expected to grow at a compound annual growth rate (CAGR) of 8-10% over the next 5 years, driven by expanding end-user industries
Access to Affordable Labor and Skilled Workforce
Cost Advantage: Labor costs in India are significantly lower compared to other countries, providing a competitive advantage for investors. India’s labor cost is approximately 30%-40% lower than in China or Western nations
Skilled Workforce: India has a large pool of skilled professionals in engineering, chemistry, and technology. The country produces over 1.5 million engineering graduates annually, many of whom enter the chemical and petrochemical sectors
Strong R&D Capabilities: India is home to several leading research and development institutions such as CSIR and the Indian Institute of Petroleum, providing a strong foundation for innovation in the sector
Robust Growth in Petrochemical Production
Production Capacity Growth: India is among the top 10 producers of petrochemicals in the world. The country’s production capacity is expected to grow at a CAGR of 6-7% until 2030
Rising Refining Capacity: India has the fourth-largest refining capacity in the world, at approximately 250 million tons per year, which provides a steady supply of feedstocks for the petrochemical industry
Favorable Policy for Investments: The government offers tax incentives, land availability, and subsidies to encourage the establishment and expansion of petrochemical plants across the country
Strategic Location and Infrastructure
Proximity to Key Markets: India’s location makes it a key player in the global supply chain, offering easy access to Middle Eastern and Southeast Asian petrochemical hubs, as well as major global markets
Port Infrastructure: India’s coastline of 7,500 km has more than 12 major ports and 200 minor ports, ensuring efficient import/export routes for chemicals and petrochemicals
Logistics Growth: Investments in logistics and transportation infrastructure (like the Dedicated Freight Corridors) improve efficiency and reduce transportation costs for chemical industries

Market Reports

Chemical & Petrochemical Industry in India

Quick Facts: Indian Chemical & Petrochemical Industry

Overview: India’s Chemical & Petrochemical Sector

Top Chemical & Petrochemical Companies in India

Government Initiatives

Mega Trends in Chemical & Petrochemical Sector

Why India for Investment in Chemical & Petrochemical

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