India’s petchem industry to grow to $100bn by 2020 – ASSOCHAM

Nurluqman Suratman

27-Apr-2015

IndiaSINGAPORE (ICIS)–The petrochemicals industry in India is expected to grow at a compounded annual growth (CAGR) rate of about 14% and will likely reach $100bn by 2020, industry body Associated Chamber of Commerce (ASSOCHAM) said.

India’s petrochemical industry is currently valued at around $40bn, ASSOCHAM said in a statement late last week.

Petrochemicals currently contribute about 30% to India’s $120bn worth chemical industry, which is likely to touch $250bn by 2020, it said.

The country’s petrochemicals sector is one of the fastest expanding segments of the economy, growing at more than twice of growth of India’s gross domestic product (GDP) and also the global growth rate in petrochemical space that is stagnant at 6%, according to ASSOCHAM.

“Huge investments made in the petrochemical space bode well for the growth of this segment, besides there is a steadfast growth in the production activity of the main petrochemicals,” said DS Rawat, secretary general of ASSOCHAM.

“Polymers, which is the dominant part of Indian petrochemical industry is growing at a superb pace, with the middle class household boosting the consumption” Rawat added.

India’s petrochemical industry is in the process of investing over $25bn to meet the surging demand, besides to overcome the broad problems of infrastructure, power and water availability, according to ASSOCHAM.

“Securing feedstock, [the] right product mix, mergers and acquisitions (M&As) opportunities are currently key imperatives for petrochemical industry in India,” ASSOCHAM said.

Compared to US and China, India’s per-capita consumption of polymers is still in the nascent stage, the industry body said.

The opportunity to reach out to a large population and sustain the current economic growth would drive India’s polymer consumption, it said.

India consumes about 5.2 kilograms per capita of polymers as compared to China’s per capita consumption of 30 kilograms. India’s consumption of polymers is about 6.2m tonnes, which is only around 3% of the global consumption of 200m tonnes, according to ASSOCHAM.

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

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