Page 185 - CW E-Magazine (28-1-2025)

Special Report Special Report

What ails Indian chemical industry? Table 2: Chemicals imported into India in signifi cant volumes basic technologies and most focus on ap-
Product Active producers Annual imports (kt) plication development and in optimisation
o achieve Government of India’s back investments. This N.S. VENKATARAMAN Styrene Nil 877 of quality and specifi cations. The research
objective of achieving Viksit is so despite the fact Director activities can be further enhanced and
TBharat 2047, it is necessary to that several corporates Nandini Consultancy Centre Acrylonitrile Nil 175 made more productive if there is greater
build manufacturing capacities in the in chemical and allied Chennai - 600090 Polycarbonate resin Nil 175 cooperation between corporates and CSIR
country for chemicals and allied pro- sectors have turned out Email: nandinichemical@gmail.com Vinyl acetate monomer Nil 165 labs, which have considerable facilities.
ducts in a massive way to promote self- good performance in Isononanol Nil 106 Perhaps, the feasibility of privatising CSIR
suffi ciency and reduce import depen- recent years and have Issues facing Indian chemical industry Methylene diisocyanate Nil 100 labs to some extent can also be considered
dence. However, there is no indication sizeable investable surplus. Despite the steady growth in (MDI) to provide greater thrust and motivation
this is happening to the level required, demand for chemicals and allied pro- for research.
and capex in chemical industry in India India’s share in the global chemical ducts due to growth of Indian economy Citric acid Nil 91
is moving at a snail’s pace. market is just around 1.98%, which is a in multiple directions, domestic capa- Bisphenol A Nil 75 R&D efforts lose relevance if they
dismal fi gure considering the country’s city is not being built in sync with L-Lysine and its salts Nil 64 do not meet timelines. Several research
In spite of several proactive measures size and population. The Indian chemical growth in demand. Polycrystalline silicon Nil 10 projects in India are now inordinately
initiated by Government of India, massive industry is nowhere near the size of the delayed. There must be an increased
government spending in infrastructure industry in China, in spite of the fact that Import dependency, particularly on Silicon metal Nil 60 aptitude for acceptance of risks and
projects and rising domestic demand for India’s population is currently just above China, has now reached high levels, Vinylidene chloride Nil 9 failure in R&D. There is risk inherent
chemicals in growth-oriented sectors, it China’s. In 1995, China’s share in the global but Indian importers do not seem to be (VDC)/PVDC to innovation and it is necessary to re-
seems most corporates in India are holding market was only 3%, which has now gone unduly concerned about this. There are Polyacetal Nil 48 concile to such risks, instead of running
up phenomenally to more than 40%. constraints on availability of technical away from domestic R&D pursuits and
Table 1: Global chemical industry knowhow due to inadequate domestic DL-Methionine Nil 46 seeking technology from abroad mostly
size and India’s market share Reasons for spectacular growth of R&D efforts and inadequate R&D Mannitol Nil 8 at exorbitant costs.
Region Value Share Chinese chemical industry spending by private organisations as Super absorbent poly- Nil 40
(€ bn) (%) Indian chemical units have to learn well as State and Central Governments. mers It is very concerning that Indian
China 2,390 41.17 a lot from their counterparts in China. Large States like Tamil Nadu, Karnataka Adipic acid Nil 39 chemical industries still continue to im-
EU (27) 760 13.09 and Punjab budgeted just 0.01%, Polyvinyl alcohol (PVA) Nil 39 port process technologies for products
The reasons for spectacular growth of 0.07% and 0.11%, respectively, of State
USA 606 10.44 China’s chemical industry are many and GDP for R&D in fi nancial year 2024-25. Rutile titanium dioxide 1 220 that are already being produced in India
for several years. Further, there appears
Japan 227 3.91 important ones include the following: India, as a whole, ranks poorly in re- (chloride process) to be no nationwide coordinated stra-
South 139 2.39  Large domestic demand potential, search expenditure compared to the on capex, either due to lack of confi - government’s ability to support the tegy to shortlist R&D priorities in tune
Korea due to size and population of China; global average. dence to operate in the global market in chemical industry to the extent required with the country’s needs and strengths.
Brazil 120 2.07  Proactive industrial policies of competitive conditions or lack of con- for various reasons and compulsions, the In such condition, many R&D efforts
Governments;
The operating chemical units in
India 115 1.98  Encouragement to multinational private and public sector too are not fi dence in domestic R&D and techno- government of India seems to be taking result only in fi ling of patents and
proactive steps to ensure the growth of publishing of papers in journals. Govern-
logical capabilities. Many are succumb-
Taiwan 89 1.53 companies (MNCs) to invest in investing adequately in R&D projects ing to the temptation to invest in ‘quick the industry to the extent possible. Pro- ment of India should set up a Task Force
Saudi 87 1.50 China, by ensuring appropriate and seem to be reconciled to a large money’ projects (such as real estate), ject promoters must recognize that they to identify priority areas for research
Arabia investment climate; extent to buy technology from abroad. instead of ploughing back resources in too must take several measures to improve in consultation with the industries and
Russia 79 1.36  Facilitating healthy competition In such a situation, it appears chemi- building up new chemical projects or the performance of chemical industry. R&D bodies, fi x timelines and allocate
Rest of 620 10.68 between domestic companies and cal projects can be set up in India only expanding existing ones. While there are several irritants confront- funds for such R&D pursuits.
MNCs;
ing chemical industries, particularly due
to the extent that technology is avail-
Asia  Additional focus on select invest- able from abroad. Excessive dependence Heavy dependence on imports to the complexity of politics, the biggest Success in R&D is possible only if
Africa 60 1.05 ment areas based on China’s advan- on domestic market has also prevented India is now one of the major stumbling block is in the technology front. scientists and other stakeholders func-
Rest of the 107 1.84 tages, such as coal-based chemical large-scale capacity build up. The importers of chemicals and allied pro- tion with pride, in a time-bound, cost-
world projects; inability to penetrate export markets can ducts in the world with import levels Importance of developing core conscious manner. There are certainly
Latin 193 3.32  Strong R&D initiatives by domestic be attributed to poor economies of scale, increasing at alarming level year after technologies enough investigation avenues awaiting
America companies and MNCs; as well as lack of adequate number of year (see Table 2). R&D activity in India is largely carried exploitation in India. If there is adequate
Rest of 213 3.67  Entrepreneurial zeal of the private globally operating trading houses in India. Primary factor ailing Indian chemical out by government-funded CSIR labs, in dynamism in innovation efforts, the pre-
a few universities and in a few large cor-
sent crisis would be overcome and Indian
sector; and
Europe  Aggressive global marketing Despite healthy balance sheets, industry porates. In the large and medium scale chemical industry will forge ahead in
Total 5,805 100 efforts. corporates seem to be holding back While there are limitations in the companies, only a few are developing both the Indian and global contexts.
184 Chemical Weekly January 28, 2025 Chemical Weekly January 28, 2025 185

Contents Index to Advertisers Index to Products Advertised