-Wants India to become manufacturing hub of sector, she says
-The production-linked incentive scheme last year attracted firms like Vedanta and Taiwan’s Foxconn, who promised multi-billion dollar investment in setting up units to manufacture chips
New Delhi, NFAPost:The government is considering a separate production linked incentive (PLI) scheme for chemicals and petrochemicals, said Finance Minister Nirmala Sitharaman.
Global manufacturers are interested in India where the sector is linked to 80,000 products, she said at the third Global Chemicals & Petrochemicals Manufacturing Hub summit organised by industry association Ficci.
“We are in favour of India becoming a manufacturing hub, and therefore of course we will consider a PLI scheme also for chemicals and petrochemicals,” said Sitharaman.
The government has allowed 100 per cent foreign direct investment (FDI) in the sector and unregulated it except for hazardous materials.
The specialty chemicals sector had a 12 per cent compounded annual growth rate between 2020 and 2025, helped by the country’s strong engineering capabilities, low-cost manufacturing and abundant manpower, Sitharaman said.
Specialty chemicals comprise 22 per cent of India’s petrochemicals sector and it is valued at $32 billion.
“Given how global manufacturers are looking to diversify their products and capabilities, India stands out as not only a market with a huge domestic demand as well as export possibilities,” said Sitharaman.
In the first six months of FY23, the combined export of chemicals and petrochemicals stood at $9 billion. Imports stood at $13.33 billion, Sitharaman said.
Sitharaman said Indian companies in the sector have to improve their standards in sustainability before they can work with global peers.
“It’s important to have your recycling and reusability elements high on your agenda. Efficient waste generation and management, and also how to reduce the consumption of certain resources which are high in emissions, is what you need to think about,” said Sitharaman.
The Centre is working with state governments to set up chemical and plastic parks, said Bhagwanth Khuba, minister of state for chemicals & petrochemicals and new & renewable energy.
