Chemical products are valuable and inseparable parts of modern life, and interact with almost every field of human activities. The chemical industry is of great significance to India's economic development. It is the pillar of agriculture, detergent, pharmaceutical, polymer additives, building blocks, paint and other downstream industries. The increase of chemical consumption is a growth indicator of a country.
Overview of Indian chemical industry
India's position in global chemical manufacturing and trade is more and more prominent. India's chemical industry produces more than 80000 commercial products and currently accounts for 3% of the global market. Most industrial products are either consumed locally or exported to other countries to earn foreign exchange reserves. The total value of the industry was $167 billion in 2017-18, but is expected to exceed $300 billion by 2024. At present, the industry's product output ranks sixth in the world and fourth in Asia.
Reasons for the growth of Indian chemical industry
In the past few years, India's chemical industry has been growing due to favorable conditions and policies. Thanks to the use of the latest technology and infrastructure, India is slowly catching up with global manufacturers in terms of quality and output. In addition, research and development investments in the sector have helped to produce specialty, basic and industrial chemicals for consumers. As a result, the industry's competitiveness against global players has improved significantly over the years.
In addition, there are many factors contributing to the growth of India's chemical industry, as follows:
Closure of factories in EU and China
With the closure of factories in the European Union, China and other countries, global chemical manufacturing companies have moved to South Asian countries due to strict regulations and environmental considerations. This result provides an appropriate opportunity for Indian companies to take advantage of the gap created by this provision, which they have successfully overcome. Many companies have set up factories in India as the Indian government eases control and adopts active policies to attract more investment. The government provides 100% foreign direct investment in the chemical industry, except for the production of hazardous substances.
Cheap skilled labor
India is one of the world's largest exporters of skilled labor. Companies operating in India do not have any difficulty in recruiting competent candidates for different positions, and they can do so at lower wages than in other countries. It's a bonus point for a company to save money while getting high quality works. As a result, companies can reduce the overall price of products produced in India.
Increasing consumption of chemical products in India
With the growth of India's GDP, India's per capita consumption of chemicals has increased dramatically over the years. India has domestic chemical consumption, and some products that India does not produce are imported from other countries. This supports the industrial sector and paves the way for growth and investment.
Research and development facilities
Most companies are investing in research and development of chemicals to meet the growing demand for quality materials. Special chemicals are a good example of these chemicals, which affect the use of industrial applications. Despite its small size, Indian companies are focusing on producing quality materials for consumers.
India's chemical industry is on the growth path due to many advantages, such as cheap labor, growing domestic consumption and the establishment of companies to compete with large companies. That's why more and more chemical products traders and buyers are paying attention to India's chemical industry.
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