The specialty chemicals industry in India has been on an accelerated growth trajectory over the last few years and is one of the best performing sectors within the Indian manufacturing space. The industry finds product applications across a wide range of industries such as agriculture, food & beverages, health, personal care, automotive, electronics, water, and others. In recent years, there has been a growth in demand from consumers of this industry, thereby fueling growth in application of the specialty chemicals products. Globally, the industry’s growth is expected to be mainly supported by improved momentum in Asian markets. 

 

Over the past few years, India, among other Asian countries, has emerged as one of the preferred manufacturing hubs for companies across the globe. The Indian specialty chemicals industry currently stands at US $32 billion and is further expected to grow at a healthy 12% CAGR over the next five years, reaching US $64 billion by 2025.

 

The home care and cleaning products industry, across the globe and in India, has seen a strong traction over the past years led by several factors, including growing population, increase in per capita disposable income, rapid urbanization, and increased awareness about health and hygiene, particularly in developing countries amongst others. The advent of the COVID-19 virus has brought the importance of everyday hygiene and anti-viral products to the forefront. The Home, Personal Care and Performance Chemicals industry, across the globe, saw a significant influx of demand for its product applications such as sanitisers, surface cleaners, hygiene products, and other anti-viral product portfolios. 

 

• Rising awareness of health and hygiene among all strata of society

• Strong uptick in rural demand and consumption

• Consumer awareness and aspirations for beauty, hair-care, and grooming products

• Increased premiumisation and focus on branded products

• Increased shift towards natural, eco-friendly, and organic products

• Focus on water purification and waste water management

 

India is one of the world’s largest producers of textiles and garments, indicating a high domestic demand for textile chemicals. Textile processing techniques include the use of a variety of chemicals to prepare, treat, and dye fabrics. Textile chemicals are used during every processing stage of textiles, and are generally classified as auxiliaries and colorants. Increasing global and domestic consumption of high-quality textile goods, rising textile production, favorable government policies, and an increase in foreign brands sourcing garments from India have together contributed to the increased demand for textile chemicals in India.

 

• Rising disposable income augmenting demand for varied textile products

• Online and omni-channel retail markets boost consumption patterns

• Rising demand for home furnishings, floor coverings, and technical textiles

• China-plus-One procurement strategy expected to bring in an influx of manufacturing demand for India

• Stringent environmental regulations across several global market places creating demand for green, clean, and sustainable textile chemical solutions 

• Increasing demand for finishing chemicals like anti-microbial properties, wrinkle-free properties, stain-resistance, and others

 

The Indian market for animal and pet nutrition ingredients, in recent times, has seen a strong surge in demand for pet care products owing to more people seeking the company of pets. Additionally, pet parents are looking at healthy and nutritious food offerings for their furry friends. Animal or pet food additives are dietary ingredients that are supplemented to increase feed quality and digestibility, as well as animal efficiency. Indian Animal & Pet Nutrition Ingredients Market consists of Amino acids, vitamins/carotenoids, enzymes, minerals, probiotics, and others. 

 

• Increased awareness about pet care and pet health

• Growing popularity of pet parenting, especially in nuclear families

• Highly specialized and premium animal nutrition driving demand for highly specialized ingredients

• Emerging demand for aquaculture feed to fuel the demand for feed ingredients

 

Despite facing serious volatility in raw material prices and availability in the past few quarters, we expect the growth of specialty chemicals to continue and are quite optimistic of improving our performance. As an industry, we must focus on sustainable products and solutions that not only act as green alternatives to harmful chemicals but will also help us overcome several of the existing challenges like wastage of materials and pollution.

 

Government support in terms of providing a conducive environment for boosting local production will go a long way in making India the next manufacturing hub. Budget 2021 outlined the importance of being self-reliant and it was evident through measures introduced to boost local demand. We look forward to Budget 2022 continuing to support the industry’s growth. Considering that the chemical industry is a critical and integral part of the growing Indian economy and present enormous opportunities of attracting investment and creating jobs in the near future, the government’s initiative to sanction PLI Scheme for chemical manufacturers will help us convert challenges into opportunities and realign the supply chain from China to India thus making India a major chemical manufacturing hub globally.

 

The long-term outlook for the specialty chemicals industry in India remains very optimistic. With multinationals focusing on ‘China plus one’ strategy, there is an enormous scope for the entire specialty chemicals industry to grow multifold. Within this, sectors like home and personal care, textile, nutrition, grooming etc. are also poised for significant growth. As the competition rises, sustainability continues to be a strategic priority and differentiator for us. 

 

We continue to invest in new chemistry to develop specialized products based on the foundation of eco-friendly processes. Our single-minded focus behind this is to provide increased performance and value, while meeting the goals of protecting and enhancing human health and the environment.

 

Authored By: Sunil Chari, Managing Director & Co-Founder, Rossari Biotech Limited and Edward Menezes, Executive Chairman & Co-Founder, Rossari Biotech Limited