With Indian chemical industry expected to grow with a CAGR of 9-9.5% as per the pre-COVID 19 projection, there is a great opportunity to bridge the export - import gap which currently stands at around US$ 26 billion. “We are in a pretty good sweet spot right now. We were at about US$178 billion of this chemical market and almost US$ 45 billion of import and US$ 19 billion of export every year. So, we are in net deficit so far and this itself is a very sweet opportunity for us,” Suresh Kalra, VP & MD - India, SI Group, said while speaking at the recently concluded e-Conference titled “Aatm Nirbhar Chemical Series” organized by Indian Chemical News.

Explaining the reason for the growth opportunity, he informed that the global market was growing at about 4% of CAGR for the next 4-5 years from $2.7 trillion to $5 trillion and then from $5 trillion to $6.5 trillion. “India, the last estimates before COVID, was that we could grow almost at about 9 or 9.5% of CAGR for the next 4-5 years. These numbers are published by agencies that can be trusted with some deviation here and there,” he said.

His optimism is based on the growth story of Chinese chemical industry which has performed well in the last two decades. “Taking the example of what China did right and what India can do better could be very helpful for us. China had 6% share in the global chemical market in 2000 and they grew from 6% to 18% in 2009 and today China has a market share of 36%. Although it seems like an almost impossible task to move from 6% to 36% in 20 years, but China did it well and we might well be sitting at the same spot right now. There is a real opportunity for Indian chemical industry to grow,” he emphasized.

Elaborating it further, Mr. Kalra suggested that India can also learn from China regarding practices which possibly China could have done better, and India now can learn from these. “We all buy a lot of products and it is one of the largest single sources of supply for all of us. We had seen 68% of our dependence on that in some market segments. But the industry have now seen that they have landed into certain problems with one single source of supply in terms of business continuity. China realized possibly later that environmental issues need to be addressed even more seriously; disaster management must be done at another level. Chinese chemical industry was growing very fast and well,” Mr Kalra said, adding that India can address these issues right from the very start. He further said that India has to focus on these kind of companies and people that aims for sustainable and balanced growth.

He explained the meaning of ‘Aatma Nirbhar’. “Being ‘Aatma Nirbhar’ and being self-reliant does not actually by any chance should be taken as isolation from the world. It does not mean isolation. It only means that we need to be a part of a much larger global supply chain of the chemical Industry, and must also be leading that.” He highlighted that there is a need for a strong R&D in the chemical sector if the industry really wants to be successful in self-reliance. He emphasized that taking a short-term approach is not the right thing to do in our industry. We need a long-term approach because the industry deals with hazardous chemicals, difficult disaster management plans, etc.”

He urged the government to facilitate manufacturing, FDI inflows and encourage the MNCs in the sector for ‘Make in India’. “There are many MNCs which have some presence in India, and also a lot of presence outside of India too. We make products in India, but we do not make all products in India. So, it is ‘Make in India’ versus ‘Sale in India’ for us,” he said adding that our decisions to manufacture in India depends on whether it is financially beneficial or not.

“Government has to identify these multinational companies who can ‘Make in India’, who have all the intentions to ‘Make in India’ but they are not making in India because it is economically not that beneficial to them. While, we are selling in India; and there are many large organizations in India that are importing a lot of products. Rather the focus should be on - if you are already there in India what government can do to help us so that we can start making everything in India rather than importing. So, we should focus more on ‘Make in India’ instead of only ‘Sale in India’,” he suggested.