The Indian chemical and petrochemical industry is facing four challenges - sustainability, circular economy, skilling and technology upgradation, says Nirmala Sitharaman, Union Finance Minister. Potential Indian partners of global investors who are keen to invest in this sector through joint ventures should be conscious of these challenges, she adds. Unless the chemicals and petrochemicals sector is able to bring these elements into (industry practices), India is not going to benefit, she points out. 

The government wants India to become a manufacturing hub and will consider a production linked incentive (PLI) scheme for the chemicals and petrochemicals sector too, she says.

Addressing the FICCI’s 3rd Global Chemicals & Petrochemicals Manufacturing Hubs in India Summit’, in New Delhi on July 27, Sitharaman says that India has set its sight on becoming energy independent by 2047 and achieving net zero by 2070. She further urged the industry to play a key role in this mission. “Net zero cannot be achieved unless each one of the industry and sector contributes to it. We are very focused on Green growth, carbon intensity has to be reduced and therefore, each one of the sectors has to contribute towards this,” she emphasises.

Highlighting the challenges in the sector, the minister urges the industry to focus on issues related to sustainability of the products and processes, immense need for skilling, need to adopt Industry 4.0 in a very big way, skilling of people and pollution control regulations. “India has made an impact in the sector globally. The combined exports of major chemicals and petrochemicals in 2022-23 was $ 9 billion but also an increase in imports to $ 13.33 billion. I am quite comfortable with this but many of these imports are items which can be produced in India itself and there are some efforts in that direction as well,” she states.

Sitharaman also urges the industry including FICCI to look at ways to become a circular economy and said the government will look into the recommendations submitted by the industry to make the sector sustainable.

She also says that the market of specialty chemicals is growing exponentially and industry in India is expected to grow at 12% CAGR. “I, therefore, understand the need for more robust support for specialised chemicals. The emergence of this market is driven by the country's strong process engineering capabilities, low-cost manufacturing capabilities and abundant manpower,” the minister notes.

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