Indian PVC demand up by 3% in 2011–2012

12 April 2012 14:43  [Source: ICIS news]

MUMBAI (ICIS)--Indian polyvinyl chloride (PVC) demand increased by 3% in 2011–2012 to 1.98m tonnes, a senior industry executive said on Thursday.

Demand growth was influenced by the country’s tight fiscal policy, said S S Naik, senior vice president at Indian major Reliance Industries, speaking at the Vinyl India 2012 conference in Mumbai. The 3% rise was still slightly higher than earlier expectations of a 1–2% growth.

The country imported 729,000 tonnes of PVC in the year to 31 March 2012 – an increase of 55,000 tonnes from the previous year.

Indian PVC imports are expected to increase significantly, as demand is outstripping the country’s growing downstream processing capacity. “Indian producers face severe competition from overseas suppliers,” Naik added.

PVC pipes remain the dominant end-use, accounting for 70% of demand. Markets for other applications need to be expanded, Naik stressed.

He was confident of PVC’s growth potential, as investment in the construction and irrigation sectors is expected to grow.

Naik added that the country faces a shortage of 22m housing units in urban areas, and the Indian government has set a target to construct 2m units/year. Each unit can consume 200kg of PVC products such as pipes, doors and windows. As a result, this segment has the potential to create demand for 400,000 tonnes of PVC in the future, Naik estimated.

Planned government investment in irrigation over the next five years has the potential to generate demand for 8.5m tonnes of PVC, while the power sector can create a need for 1m tonnes of PVC for use in wiring and cables, he added.

By: Malini Hariharan
+65 6780 4359

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