China’s supply disruption has led the end-user industries globally to expand their base of vendors primarily towards Indian players. China’s and EU’s plant closures have led to Indian manufacturers being favoured to invest in speciality chemicals as a result of rising concerns about the environment.
Also, organic and inorganic chemical exports rose 22.1% year-on-year from April to July 2022 to reach 963 million metric tonnes.
100% FDI and industrial licensing in the chemical sector are enabled with few dangerous chemicals under the automatic route. Between April 2000 to December 2022, FDI inflows in the chemicals sector, except for fertilisers reached USD20.96bn.
Indian companies are witnessing interest from strategic investors in Korea, Japan and Thailand since they intend to expand China’s supply.
Inorganic and organic chemical exports were forecasted at USD17.19bn from April 2022 to March 2023.
In May 2023, Reliance intends to build a 10 GW solar project in Andhra Pradesh, India. Moreover, Chennai awaits more bio-CNG plants to enable it to switch to clean energy in March 2023.
The company Reliance is about to set up a new formaldehyde plant with 300 TPD capacity at GIDC, Ankleshwar in Gujarat, India.
Essar-backed Vertex signed an agreement with Tata Chemicals in January 2023 for the sale of low-carbon hydrogen.
GMM Pfaudler Ltd has signed an agreement to acquire Mixel France SAS in December 2022 along with its completely-owned subsidiary Mixel Agitator Co. Ltd. for USD 7.63mn.
Spanish perfume maker Puig acquired a controlling stake in Kama Ayurveda Pvt.
In September 2022, Spanish perfume maker Puig acquired a controlling stake in Kama Ayurveda Pvt. Owning 85% of the company.
Owning 85% of the company in September 2022. Along with partners Samara Capital and CX Partners, PAG acquired Optimus Group in May 2022. PAG is a global investment firm.
Producer of research-based specialised chemicals Dorf Ketal in April 2022 has acquired Khyati Chemicals for USD36.28mn – 48.48mn.
Moreover, a majority position in Avra Labs was acquired in January 2022 by Advent International uniting it with two other companies, it had previously acquired i.e. ZCL Chemicals and RA Chem Pharma. The contract also included deals in FY20 of KKR’s USD414mn acquisition of JB Chemicals and Pharmaceuticals Ltd. along with Carlyle’s acquisition of SeQuent Scientific Ltd. for USD210mn.
Moreso, the Government of India supports the chemical industry through research and development and initiatives like reducing basic customs duty on many imported products and promoting the ‘Make in India’ campaign.
Moreover, the Indian Government supports by research and development and initiatives, the chemical industry. Initiatives include decreasing basic customs duty on many imported products and promoting the campaign ‘Make in India’.
The Indian Government has set up a vision 2034 for the petrochemicals and chemicals sector to explore opportunities to improve production domestically, decrease imports and attract sector investments.
An incentive system is to be implemented by the government that is production-linked with 10-20% as output incentives for the agrochemicals sector. The government also plans to build a manufacturing ecosystem through cluster growth. The Indian Government intends to promote lower per capita consumption and ease of doing business. This in turn shall reflect large investment opportunities.
Also, four investment regions for petroleum, chemicals and petrochemical investment or PCPIRS has been created for petroleum, chemicals and petrochemicals along with associated services. In order to create specialised plastic products, plastic parks have been set up to facilitate technology development and a favourable ecosystem.
The chemicals and Petrochemicals department intends to bring PLI in the chemical and petrochemical sector and shall again make petroleum, chemicals and petrochemicals investment region or PCPIR guidelines.
A complete investment of USD142bn is estimated by 2025, USD284bn is estimated in all PCPIR’s pan-India by 2035 and USD213bn by 2030.
Indian Oil Corporation had announced in November 2021, an investment of USD495.22mn to set the country’s First mega-scale maleic anhydride unit in Haryana for producing high-value speciality chemicals at Panipat refinery.
For manufacturing water speciality chemicals for use in the Middle East refining and petrochemical industry, India-based Dorf Ketal Chemicals India Pvt. Ltd. along with Saudi-Arabia-based TriBonds Chemical Co. Have announced a joint venture. The venture shall target the energy and water management and processing requirements of petrochemicals, catalysts, adsorbents, oil field chemicals, lubricants, plastics and fuel additives.
The Indian Government under the Union Budget 2022-23 allocated USD27.43mn to the Chemicals and Petrochemicals Department. Moreover, PLI schemes in order to promote Bulk Drug Parks along with a budget of USD213.81mn have been introduced.
