Chemical Industry Chronicling the Journey of the Budding Indian Chemical Industry
Marred by a turbulent past, foreign competition and a not-so-favourable public persona, the domestic chemical industry has, nonetheless, accomplished its fair share of growth and development. A look at some of the finer details of this journey.
The Indian chemical industry has undergone an impressive process of evolution and transformation over the last few decades. This sector, which contributes six percent of the country’s GDP, is poised to achieve further growth as the increase in per capita consumption spawns a corresponding increase in overall domestic demand for chemicals.
According to the Index of Industrial Production (IIP), the domestic chemical industry grew from 313.4 in 2007–08 to 361.0 in 2009–10, and all three sub-segments within the domestic chemical industry—basic, knowledge and speciality—are expected to record double-digit growth during 2008-12.
An industry that was once closed to investing in R&D and preferred to make do with near-redundant technologies handed down from its Western counterparts is witnessing a dramatic turnabout as Indian chemical manufacturers are now making concerted efforts to undertake R&D activities. Experts attribute the slow, but steady headway that the industry has now begun to make, to this transformation in attitude.
Specialising in speciality
Speaking with PROCESS India, SR Lohokare–MD, National Peroxide Ltd and Chairman, Western Region, Indian Chemical Council, said, “India is well-placed in the speciality chemicals segment, where significant developments are taking place.”
The area of speciality chemicals comprises six sub-segments, namely paints and coatings, dyes and intermediates, catalysts, construction chemicals, and water treatment and personal care. Of these, paints and coatings is currently valued at US$ 2.5 bn, and, with the current upward trend in per capita paint consumption, has been estimated to grow 10.6 percent. In recent years, upgraded quality standards have allowed this sub-segment to scale to international standards.
The dyes and intermediates sub-segment is holding its own in an increasingly competitive global market, and is currently pegged at US$4 billion. Manufacturers of these speciality chemicals have leveraged the easy availability of raw materials and an affordable workforce in India to enhance performance. Further, Mr Lohokare shares that many major players in this category are increasing their market share through acquisitions. He cites the acquisition of the German DyStar Group by the Ahmedabad-based Kiri Dyes and Chemicals as evidence of the increasing popularity of this trend.