The PCPIR policy is expected to be completed by 2025 and will drive the combined investment of around Rs. 4 lakh crore while speaking at APIC 2023
Within less than two years time that I have spent in the petrochemicals sector, I can say with a degree of confidence and certainly with a degree of satisfaction that we are witnessing some important strides being made by India, stated the Union Minister of Petroleum & Natural Gas and Housing & Urban Affairs, Hardeep Singh Puri while addressing the delegates at the Ministerial Panel at Asia Petrochemical Industry Conference 2023 (APIC 2023) in New Delhi on May 19, 2023.
Themed ‘Ushering in a Sustainable Future,’ the event was well attended by leading chemicals and petrochemicals players from India, Japan, Korea, Taiwan, Malaysia, Thailand, and Singapore besides other stakeholders including global investors and government officials.
Talking about the tremendous display of resilience by India, especially during the pandemic, Puri said, “In the coming two decades, 25% of the global energy demand will come from India. For a country which is 1.5 billion strong and a country which has to manage the challenges of availability, affordability, and sustainability, we have already demonstrated that we can do it. I will share an example. When the COVID-19 pandemic hit India, our health sector geared up quickly. As a civil aviation minister, I can tell you that we sent 1,500 metric tonnes worth of medical supplies abroad, and 943 metric tonnes worth medical supplies including PPE kits were distributed across the country. That is the true Atmanirbhar Bharat (Self Sufficient India). There used to be a lot of skepticism about vaccines but we were able to provide affordable and free vaccines. Today we have well established manufacturers of vaccines.”
Speaking in the context of chemicals, the Minister added, "Despite the turmoil globally, we didn’t allow the energy crisis to affect us at all. We witnessed a new resilient India. The per capita consumption of few chemicals is significantly lower compared to developing countries. That offers substantial space for demand growth and investment opportunities. The sector supports the demand for Make in India for domestic consumption and for the world. We are moving towards transforming India into a global manufacturing hub. India today is not only the sixth largest producer of chemicals in the world but also fourth in Asia. It exports chemicals to more than 175 countries in the world, accounting for 13% of total exports. The growth of the petrochemical industry in India will be driven by several factors. One of the most important is the increasing demand for petrochemical products from a growing population. A large proportion of the demand is coming from the middle class that uses a large number of products made from petrochemicals."
"The Indian petrochemicals industry has come a long way since inception in the 1970s and is poised for transformational growth. It is expected to contribute almost 10% of incremental growth in the global petrochemical demand in the coming years," added Puri.
Minister emphasized the favourable policies, also pointing out the huge potential of the sector.
“A lot of policy infinitives such as ease of doing business, 100% FDI in greenfield through automatic route and PCPIRs will provide a boost to the sector. The PCPIR policy is expected to be completed by 2025 and will drive the combined investment of around Rs. 4 lakh crore. India’s dependence on the petrochemical intermediaries is staggering 1.5%, one the highest in the manufacturing industry. India currently is the net importer of all chemicals except for Benzene and Chips. The sector continues to grow at the rate of 1.5 times the GDP. It is expected to reach US $300 billion from the current US $175 billion by 2025. In the coming decades the investment worth US $87 billion is expected. The chemicals and petrochemicals trade is expected to triple to reach US $1 trillion by 2030,” said Puri.
"The government is trying to address the challenges and several flagship initiatives are in the offing to promote competitiveness. Digitalization is also underway in the sector and it establishes India as a reliable player in global value chains. Our refining capacity has grown from 215 million metric tonnes in 2013-14 to current 251 million metric tonnes, moving us to fourth position after the US, China, and Russia. There are plans to take this 300 million metric tonnes per annum," concluded Puri on a highly optimistic note.
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