A quiet change is underway in the global chemicals industry. For years, leaders focussed mainly on cost and efficiency. The focus has now shifted to reliability. 

Rising costs in parts of Europe and growing pressure to build more resilient supply chains are forcing companies to rethink where they manufacture and how they manage risk. Demand is shifting, too. More and more of the world’s incremental chemical consumption is now coming from faster-growing markets, where new consumers and industries are emerging. India sits at the centre of this change. Domestic demand is scaling rapidly and is projected to double to over $300 billion by 2030, from nearly $150 billion today.

Many global chemical companies have recognised this dual shift and are now looking at India not only as a market to serve, but as a place to build a meaningful part of their next growth engine. Conversations in boardrooms have already moved from “why India?” to “how do we build a scale business in India?”

The opportunity is huge, but so is the challenge.

India’s constraint is not demand or cost competitiveness; it is structural. Value chains remain fragmented and under-integrated, with gaps in feedstock-to-finished-product linkages and limited access to process technology. This has created a chronic import dependence. India imports roughly $71 billion of chemicals annually, and the trade deficit for the sector has nearly doubled from about $17 billion (2020) to about $32 billion (2024).

As a result, more than half of the world’s Top 100 chemical companies still lack a significant manufacturing presence in India.

But this is likely to change. Consider this: Over the past two decades, core chemistries have been commercialised and stable revenue streams established, often in the $250-500 million range. Capital markets have rewarded this performance: Indian chemical companies have outperformed the Nifty by roughly 2x over the past five years, and many now sit at meaningful scale and valuations.

Why partnerships? And why now?

Partnerships are the fastest route to address gaps at pace, as they combine complementary strengths that are difficult to build organically within the same timeframe. Indian players bring a deep understanding of the country’s regulatory landscape, an execution track record, and the ability to build at speed and scale. Global players, on the other hand, bring proprietary process technologies, differentiated portfolios, mature systems across RCD, and credibility with global customers. Further, they can connect India-based assets to global networks involved in sourcing, innovation, and distribution.

When both sides want speed and assurance, partnerships can turn intent into execution. 

The three partnerships that matter

Given this, there are three partnership plays that matter. These are:

1.  The ‘second home’ model: These are build-to-scale manufacturing partnerships. For global companies, this is the most direct path to a diversified, reliable manufacturing base in a world that values redundancy. For Indian promoters, it is a route to proven process technology and new customer ecosystems, especially in chemistries where qualification, consistency, and long-term supply assurance are decisive.

2. The ‘solution’ model: A combination of global application know-how with India’s scale. As end markets premiumise, the most defensible positions in chemicals increasingly combine manufacturing strength with formulation and application expertise. Partnerships that link global product and application capability with India’s operating scale can compress qualification cycles and build stickier customer relationships.

3. The ‘global–India corridor’ model: The partnership with technical “hidden champions.” Historically, many global chemical companies have served India through imports and distribution, a low-touch model shaped by perceived operational complexity and a shortage of credible local partners. That model is changing. A new corridor can emerge through partnerships (and selective acquisitions) with mid-sized technology-rich companies, particularly where succession and strategic realignment create conditions for openness to collaboration. 

What Indian CEOs and promoters should do

Indian CEOs and promoters should choose arenas where India can win at a global scale. They should, however, not let the import bill be the ceiling. They need to identify large, persistent gaps where world-scale investments are justified, and then look beyond import substitution to export-oriented value chains where India can build advantaged capacity for global customers. They also need to move early with respect to scarce enablers: land with strong connectivity, clear titles, and reliable utilities; environmental permissions; and a strong engineering and project-execution bench. These are increasingly becoming competitive differentiators. In the next cycle, access to “ready-to-build” platforms may matter as much as access to capital. It is important to build a partnering capability that is lightweight but serious. Many partnerships slow down not because the intent is weak, but because the process is unclear. A small, empowered partnering “front door” can help engage multiple global players in parallel, respond quickly, and build momentum, without adding bureaucracy.

The promoters and CEOs need to define their boundary conditions early and stick to them. Leadership teams that align upfront on scale, return thresholds, priority chemistries, end uses, IP expectations, and capital can move faster on the right opportunities and walk away from the wrong ones with confidence.

What global chemical companies must do

The first step for global chemical companies does not have to be “full scale” on day one. But the ambition must be clear enough that Indian promoters and leadership teams see it as worth leaning into. The global companies need to invest in trust, patiently and personally. In India, trust is rarely built through a single presentation. It is built through continuity: repeated conversations, time spent with the promoter and leadership team, and a willingness to engage beyond the formal meeting room. Many global leaders are now carving out time for India in their quarterly calendars.

Building here is a long game, but it cannot be run at the speed of a distant headquarters. Global companies need empowered, local decision-making and strong leadership on the ground early, which is often a decisive factor in whether partnerships translate into execution. 

The key takeaways

India’s chemical sector is at a rare and exciting intersection. One key factor is the government’s “Make in India” push with its linked incentives. The second is a growing set of promoters and chemical leaders who have built real scale and earned the confidence of customers as trusted partners. The third factor is demand, with a meaningful share of incremental consumption coming from India. And finally, there is the Western world, which is facing a tougher cost environment and a renewed urgency to diversify supply chains. The idea is not to be dependent on any single source, including China.

Taken together, this feels like a once-in-a-lifetime opportunity for India’s chemical industry. The real questions are about the pace and outcomes.

How quickly can the industry convert this moment into momentum? Global partnerships are likely to be one of the biggest determinants of speed, as they can combine India’s execution strength with global process technology and customer ecosystems.

Who will capture the upside? A small handful of leaders or a broader set of companies using partnerships and focused bets to scale meaningfully?

What will it take to make partnerships work consistently, not episodically? The winners will be those who blend speed with trust: fast decisions, clear governance, and transparent execution that give global boards confidence to scale

Finally, is there a bigger aspiration that can anchor this chapter? This can be achieved by making sure that the larger aspiration is to move beyond “India for India” toward “India for the world”, in the process building sustainable chemical supply chains that global customers can rely on for the long run.

(Gandhi is MD and senior partner (India chemical sector lead); Murjani is MD and partner at BCG. Views are personal.)