World's chemical nucleus

Market size of Chemicals & Petrochemicals sector in India is worth ~$178 bn

Chemicals industry in India is highly diversified, covering more than 80,000 commercial products. It is broadly classified into Bulk chemicals, Specialty chemicals, Agrochemicals, Petrochemicals, Polymers and Fertilizers. India’s proximity to the Middle East, the world’s source of petrochemicals feedstock, makes for economies of scale.

India is a strong global dye supplier, accounting for approximately 16% of the world production of dyestuff and dye intermediates. Chemicals industry in India has been de-licensed except for few hazardous chemicals. Upcoming Petroleum, Chemicals and Petrochemicals Investment Regions (PCPIRs) and Plastic parks will provide state-of-the-art infrastructure for Chemicals and Petrochemicals sector.

  • The Chemicals and Petrochemicals market is projected to reach $300 bn by 2025
  • Indian ranks 9th in export and 6th in import of chemicals (Excluding Pharmaceuticals products) globally
  • Export of Organic And Inorganic Chemicals was valued at $2230.15 bn in August 2021 with a positive growth of 35.75% over exports of $1642.82 bn in August 2020.
  • Demand for chemical products is expected to grow at approximately 9% p.a. during 2020-25
  • Indian chemical industry employs more than 2 million people
  • Fertilizers production (weight: 2.63%) increased by 0.5% in July 2021 over July 2020

100% FDI is allowed under the automatic route in the chemicals sector (except in the case of certain hazardous chemicals)

For further details, please refer to FDI Policy

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    Nation’s Gross Value Added

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    Chemical products exports share

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    Contribution to global chemical sales

Third largest consumer of polymers in the world

Fourth largest producer of agrochemicals in the world

Sixth largest producer of chemicals in the world

Industry Scenario

The market size of Chemicals & Petrochemicals sector in India is around $178 bn; expected to grow to $300 bn by 2025.

The production of Total Major Chemicals and Petrochemicals in 2021-22 (upto May 2021) was 92.8 lakh MT. CAGR in production of Total Chemicals and Petrochemicals during the period 2015-16 to 2019-20 is 5.74%. Alkali Chemicals accounts for around 72% of the total production of Major Chemicals for the year 2021-22 (upto May 2021).

  • The petrochemical demand is expected to grow at 7.5% CAGR from FY 2019-23, with polymer demand growing at 8%.
  • The agrochemicals market in India is expected to grow at 8% CAGR reaching $3.7 bn by FY22 and $4.7 bn by FY25.
  • The specialty chemicals constitute 22% of the total chemicals and petrochemicals market in India. The demand for specialty chemicals is expected to rise at a 12% CAGR in 2019-22.
  • Export of Plastic and Linoleum was valued at $753.30 bn in August 2021 with a positive growth of 16.16% over exports of $648.49 bn in August 2020.


  • Rising disposable income, median age of population, urbanisation and growing penetration and demand from rural markets

  • Shift in production and consumption towards Asian and Southeast Asian countries in all sectors leading to increasing demand for Chemicals and Petrochemicals

  • Shift in consumer preferences towards a healthier lifestyle and environment-friendly products

  • Opportunity to produce $111 Bn worth of chemical products by 2023 for domestic requirements

  • Production Linked Incentives scheme for manufacturing of Advance Cell Chemistry Battery under Atmanirbhar Bharat Abhiyaan


Production Linked Incentives (PLI) Scheme

The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has given its approval to introduce the Production-Linked Incentive (PLI) Scheme in Advance Chemistry Cell Battery for Enhancing India’s Manufacturing Capabilities and Enhancing Exports – Atmanirbhar Bharat.

  • INR 18,100 Cr

    Scheme Outlay

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Asked Questions

What is PCPIR?

Government of India has approved 4 Petroleum, Chemical and Petrochemical Investment Regions (PCPIRs) in the state of Andhra Pradesh (Vishakhapatnam), Gujarat (Dahej), Odisha (Paradeep) and Tamil Nadu (Cuddalore and Naghapattinam) to promote investment and industrial development in these sectors.

The PCPIR is envisioned to reap the benefits of co-siting, networking and greater effiencies through use of common infrastructure and support services. Each PCPIR is a specifically delineated region having an area of about 250 sq. km. wherein 40% of the area has to be for processing activities.

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What is Chemical Promotion Development scheme (CPDS)?

Chemical Promotion Development scheme is a government scheme with an objective of promoting and developing the chemical & petrochemical sectors by extending financial support for conduct of seminars, conferences, exhibitions, conducting studies/ consultancies, for facilitating growth, as well as analyzing critical issues affecting chemical and petrochemical sector.

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What are OCPFs?

OCPFs comprise of two different categories of organic chemicals and these are Discrete Organic Chemicals (DOCs) and PSF chemicals.  
For more details, please visit the following link. 

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What is a DOC?

Discrete organic chemical is defined as any chemical belonging to the class of chemical compounds consisting of all compounds of carbon except for its oxides, sulfides and metal carbonates, identifiable by chemical name, by structural formula, (if known) and by Chemical Abstracts Service (CAS) registry number (if assigned). For instance: Acetic Acid ,Ethanol.

For more details, please visit the following link.

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What are the objectives of the scheme for setting up of plastic parks in India?

The major objectives of the scheme are:
1) Increase the competitiveness, polymer absorption capacity and value addition in the domestic downstream plastic processing industry through adaptation of modern, research and development led measurers.
2) Increase investments in the sector through additions in capacity and production, creating quality infrastructure and other facilitation to ensure value addition and increase in exports.
3) Achieve environmentally sustainable growth through innovative methods of waste management, recycling, etc.
4) Adopt a cluster development approach to achieve the above objectives owing to its benefits arising due to optimization of resources and economies of scale.

For more details, please visit the following link. 

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