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Snapshot
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
- FDI in Chemicals sector (excluding fertilizers) is $ 20.4 Bn (April’2000 to June 2022)
- India ranks 11th in the World Exports of Chemicals (excluding pharmaceutical products) and ranks 6th in the World Imports of Chemicals (excluding pharmaceutical products)
- The combined exports of Major Chemicals and Major Petrochemicals in the year 2022-23 (up to July 2022) have increased to INR 48.05 thousand crores from INR 47.35 thousand crores.
- Demand for chemical products is expected to grow at approximately 9% p.a. during 2020-25
- Indian chemical industry employs more than 2 mn people
- Fertilizers production (weight: 2.63 %) increased by 5.4 % in October 2022 over October 2021. Its cumulative index increased by 10.5 % during April to October 2022-23 over the corresponding period of previous year.
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 sale of chemicals in the world
- Industry Scenario
- FOREIGN INVESTMENT
- INDUSTRY TRENDS
- POLICIES & SCHEMES
Industry Scenario
The market size of Chemicals & Petrochemicals sector in India is around $178 bn; expected to grow to $300 bn by 2025.
- The quantum of production of Major Chemicals increased to 43.51 lakh tonnes during 2022-23 (Up to July 2022) as compared to 41.15 lakh tonnes during the corresponding period of the previous year, recording an increase of 5.73%.
- Overall growth in production of Major Chemicals in 2022-23 (up to July 2022) over 2021-22 (up to July 2021) has been 5.73% with major rise accounted in majority of sub sectors –
- Alkali Chemicals: 8.68%
- Inorganic Chemicals: 4.39%
- Certain sub sectors under Major Petrochemicals have recorded an increase in production in 2022-23 (up to July 2022) over 2021-22 (up to July 2021) -
- Synthetic Fibres: 3.54%
- Performance Plastics: 15.43%
- Other Petrochemicals: 2.73%
- The petrochemical demand is expected to grow at 7.5% CAGR from FY 2019-23, with polymer demand growing at 8%.
- Exports of Organic & Inorganic Chemicals values at $ 2,332.92 mn in September 2022 and shares 7.15% of the total exports of the month.
- The Average Index of Industrial Production of Manufacturing of chemicals and chemical products in the FY 2021-22 is 120.7 and has grown by 4.1%.
- The agrochemicals market in India is expected to grow at 8% CAGR reaching $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.
- Key indicators on production data for Chemical & Petrochemical sector for the month of June 2022 indicate an increase by 3.9% as compared to June 2021.
- Fertilizers production (weight: 2.63 %) increased by 6.4 % in November 2022 over November 2021. Its cumulative index increased by 10.0 % during April to November 2022 over the corresponding period of previous year.
GROWTH DRIVERS
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
Launched and approved in 2021 at a budgetary layout of INR 18100 Crore over a 5-year period. Under the scheme, the government seeks to boost local manufacturing of advanced chemistry cell to bring down prices of battery in the country, which will reduce the cost of electric vehicles as well. The scheme was designed to be technology-agnostic. The beneficiary firm were free to choose suitable advanced technology, machinery, raw materials and other intermediate goods for setting up cell manufacturing facility to cater for any application. This scheme was oversubscribed by 2.6 times (130 gwh). After final evaluation, a total of 4 companies were selected for incentives under Production Linked Incentive (PLI) Scheme for Advanced Chemistry Cell (ACC) Battery Storage. This includes Reliance New Energy Solar Limited (5GWh Awarded and 15 GWh waitlisted); Ola Electric Mobility Private Limited (20 GWh awarded); Hyundai Global Motors Company Limited (20 GWh awarded) and Rajesh Exports Limited (5GWh awarded).
INR 18,100 Cr
Scheme Outlay
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Industrial Land Bank Portal
GIS - based map displaying available infrastructure for setting up business operations in the state.
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Invest India closely works with
Government Ministry/ Department
Industry Associations
- Alkali Manufacturers Association of India
- Chemicals & Petrochemicals Manufacturers Association
- Crop life India Dye Manufacturers Association of India
- Indian Chemical Council
- Indian Speciality Chemical Manufacturers Association
- Organization of Plastic Processors of India
- The All India Plastic Manufacturers' Association
21 November,03:23 PM
Ms. Ravneet Mann, VP, Invest India spoke at the 5th Indian Chemicals and... Read More
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