1. INDIAN CHEMICAL INDUSTRY Director General Indian Chemical Council
GLIMPSE OF
INDIAN CHEMICAL INDUSTRY By
D. P. Misra
Director General Indian Chemical Council
September 2008

2. Indian Chemical Industry - Overview
12th largest in the world and 3rd largest in Asia
Indian Chemical Industry (incl. pharma)= $50 bn in 2006 – 10.8% CAGR 2002 to 2006
Market is expected to grow to $75.8 bn % CAGR by 2011
Evolved from being a basic chemical producer to also offering specialty and fine chemical products

3. Indian Chemical Industry –Segmentation
Industry divided into 3 segments
Basic chemicals, specialty & fine chemicals and knowledge chemicals.
Basic chemicals 57%
Specialty & Fine Chemicals & Knowledge Chemicals is 43%
API’s for Pharma co-formulations for Pharma
Dyes and pigment paints and inks
Adhesives
Flavors & fragrances
Agrochemicals
Source: IBEF/KPMG Report October 2007

4. Indian Segmental Market Growth
(Value wise)
All values in US$ Billion
CAGR: 16.2%
CAGR: 30.1%
CAGR: 8.5%
CAGR: 16.3%
Total Market – US$ 35 billion as on March’05
Source: Our estimation

5. Export – Import Scenario Indian Chemical industry
As on March’ 05
All values in US$ Billion
Source:

6. Indian Fine Chemicals Industry
Represents 43% of total Indian Chemical Industry – market size USD $17.2 bn
Forecasted to grow at CAGR of 15%, double the growth of Global Fine Chemicals Industry
Exports of Fine Chemicals (excld. pharma) forecasted to grow USD$ 4bn in 2007 to USD$ 13 bn in 2013
Per Capita consumption in India is still well below world average
Source: Indian Chemical Manufacturers Association

7. Indian Pharmaceutical Industry Overview
India is among the fastest growing pharmaceutical markets in the world
The domestic pharmaceutical market recorded sales of US$ 7.3 billion in 2006, grew by 17.5% over the previous year*
Indian pharmaceutical Industry is 8th in terms of volume & 13th in terms of value – due to lower drug prices
Pharmaceutical Market

8. Exports, the core of Indian Pharmaceuticals
Total export revenues ( )……………………….. $ 5.2 billion
Bulk drugs (APIs) ………………………………………..…….$ 2.8 billion (54 %)
Finished drug formulations (FDFs) …………………………$ 2.4 billion (46 %)
Revenues from FDF exports expected to reach $ 9.5 billion and surpass those from APIs ($ 8.7 billion) by and also exceed those of the domestic market

9. DMF Filings – Top Ten countries
Source: FDA / CDER; Crisil Research

10. INDIAN INORGANIC INDUSTRY
TOTAL – $2.5 Bn

11. INDIAN CHLOR ALKALI

12. SODA ASH GROWTH SCENARIO
CAGR – EXPECTED APPROX – 5%

13. Alcohol-based Chemicals – Existing capacities in India

14. INDIAN PETROCHEMICAL INDUSTRY AT A GLANCE
Commodity Polymers (PE, PP, PVC, PS)
Capacity TPA
4,215,000
Synthetic Fibre (PSF, PFY, Nylon, Acrylic)
2,069,000
Elastomers
145,000
Surfactants
409,000

15. CAPACITIES OF COMMODITY POLYMERS
CAPACITIES OF SYNTHETIC FIBRE

16. CAPACITIES OF ELASTOMERS
CAPACITIES OF SURFACTANTS

17. PER CAPITA CONSUMPTION
India (Kg)
World Average (kg)
Plastics
3.8
19.7
Synthetic Fibres
1.7
3.9
Surfactants
0.4
3.5
Elastomers
0.2
2.1

18. India - 3rd largest polymer consumer globally, by 2010. . .
Polymers : India Vs World Global Rank in Polymer Consumption
Rank
Country
1988
Country
2000
Country
2010
2010/
(MMT)
(MMT)
(MMT)
2000 1
USA
16.6
USA
27.3
USA
38.9
3.6% 2
Japan
6.4
China
14.4
China
31.3
8.1% 3
Germany
4.3
Japan
9.1
India
12.5
14.0% 4
China
3.7
Germany
6.4
Japan
11.5
2.3% 5
Italy
3.1
S. Korea
4.7
Germany
9.4
3.9% 6
CIS
2.4
Italy
4.7
S. Korea
7.4
4.8% 7
France
2.4
France
4.1
Italy
6.8
3.8% 8 UK
2.2 UK
3.5
Brazil
6.7
7.0% 9
Taiwan
1.9
India
3.4
CIS
6.2
9.1% 10
S. Korea
1.8
Brazil
3.4
France
6.1
4.1% 16
India
1.6
Taiwan
3.3 UK
5.2
4.0%
Source CPMA
India - 3rd largest polymer consumer globally, by

19. Agrochemical Industry
Global Agrochemical market in 2005 was $33,576 mn (Source:Agrochemicals-Executive Review, Agronova 2006)
India is 4th largest producer of Ag Chem after USA, Japan and China.
India is the second largest producer of pesticides in Asia.
India exports pesticides for approx.Rs.2500 crores (US$ billion).
Total Ag Chem market in India =Rs.4500 crores (US$ 1 billion).

20. India – Growth in Polymers
Growth triggers
Strong Economy
High GDP growth
Favorable Demography
Growing Middle Class
Rising Disposable Income
Policy thrust
Export through SEZ
Agriculture
Infrastructure
Retail Revolution
Indian polymer consumption has grown to 6 million in 60 years.
It will add up another 6 Million in next five years.
Packaging will grow from 3.0 Million to 6.2 Million,
Infrastructure from 0.9 Million to 2.5 Million,
Agriculture from Million,
Others will grow from Million ton per annum
12.5 MMT By FY12

21. CARG Projected (2006-07 to 2011-12) %
Sub-group report on Petrochemicals

22. Projected Demand Capacity Additions
Kilo tons
Capacity
Demand
Deficit/ Surplus
Average / Unit Size
No of Plants required
Ethylene
2005/06
2513
2715
202
2006/07
3909
1386
1000 1
2011/12
3463
8647
5184 5
All Polymers
4265
4600
-335
200 2
5338
1073
400 3
7175
11193
- 4018 10
Source: Based on Information from Dept. of Petrochemicals, MOC&F

23. Concept of PCPIR Specifically delineated investment region/s
Area of around 250 sq. kms
Covers manufacturing facilities & associated services & infrastructure
Includes SEZ/s, Free Trade & Warehousing Zones, Industrial Parks, EOU units, or Growth Centres duly notified, and existing industrial clusters.
Refineries/feedstock companies as anchor tenants
Developer/co-developer to build & develop internal infrastructure
External linkages to be provided by Central Govt & by concerned State Govt.

24. Contd….
Users to pay for use of infrastructure except when supported through budgetary resources.
Developer would develop/ build / design/ maintain/ operate part or whole of infrastructure/facilities in PCPIR.
Selection of developer through transparent process.
Developer - benefit of tax holiday under Section 80(I)(A) of IT Act
Eligibility for location - any chemical industry / supporting service in area of manufacturing, stocking, trading including logistic and utilities
Dispute resolution through arbitration.

25. Likely PCPIR Locations
Project proposals received for:-
Dahej in Gujarat,
Mangalore in Karnataka,
Visakhapatnam in Andhra Pradesh and
Haldia in West Bengal have been identified
Paradeep in Orissa
Cuddalore in Tamilnadu

26. Investors in PCPIR Could Look Forward to
World class infrastructure
Highly skilled manpower
Co-existence with value chain
Easier approach to Gulf, Asia & Africa
Fast growing domestic demand
Potential for downstream petrochemical projects
Large unsatiated & growing market
In case of commodity polymers India’s per capita consumption is 4 .8 kg compared to world average of 25 kg
Similarly in case of synthetic fibre India’s per capita consumption is 1.8 kg compared to 3.5 kg for the world

27. An Invitation
Indian Chemical Industry specially petrochemicals, speciality, pharma / biotech experiencing significant growth possibility
Time to collaborate between India and US both in manufacturing and trade
Invitation to US companies to invest in India and experience growing market with huge untapped potential

28. Thanks