The Chemical & Petrochemical Sector in India provides various inputs for essential products such as pharmaceuticals, agricultural, hygiene and healthcare. Keeping the importance of the sector in mind for the growth of economy and general well-being of the nation during current COVID-19 outbreak, the Indian Chemical Council, India’s largest and apex body representing the chemical sector feels that the entire C&PC sector value chain should be declared as ‘essential’ during the current COVID-19 led lockdown period.  The chemical industry in India has multiple cross linkages to other industries and thus it is a critical industry in the value chain of essential goods like food, edible oils, drugs, fertilizers, among others.

The chemical industry, is the industry of industries, and is currently suffering due the global lockdown because of the rapid outbreak of the current epidemic. Many essential supplies from C&PC sector are either stuck at various checkpoints in the country, or the manufacturers are not able to produce even if the permitted to operate, due to their employees not being able to report to work. According to Indian Chemical Council, “Chemicals are indispensible and it gets widely used in our modern lives. Chemicals have direct interface with essential commodities like pharmaceuticals. For instance, very few realize that key raw materials for manufacturing of Paracetamol, an essential drug, include a large number of chemicals like benzene, sulphur, caustic, chlorine, hydrogen, nitric acid, sulphuric acid, acetic anhydride.

Due to lock down of majority of C&PC plants, many of paracetamol plants are being forced to shut.  Also, polymers are life-saving with applications in catheters, blood transfusion pipes, blood bags, personal protection equipment (PPE), etc. Therefore the plastic downstream industry should also be treated essential due to its vast application in agriculture, potable water, food, process-flow etc. Chemical plants in China, Korea, Taiwan, Europe and US are already operational, as they consider Chemicals as Essential. It also implies in case of many essential life-saving drugs cannot be manufactured without uninterrupted supply of key chemicals. Food grains, the most essential commodity for any country, cannot continue its production without judicious usage of agrochemicals and fertilizers. Irrigation process in agriculture is also suffering without durable and economical water pipes.

On highlighting the operational aspect of the sector, Indian Chemical Council, says “In most continuous processes, there is a certain minimum turndown ratio, i.e. the minimum percentage of rated capacity that a plant can operate which can vary from 50-80%, depending on the product. Also, continuous process plants cannot be easily stopped and started.” While domestic demand in other countries has dropped sharply as also exports, the inventory is piling up. This poses a dumping danger for countries like India. Export incentives provided by many countries will further add burden to the industry in India.

Chemical sector should be declared as essential:

ICC strongly recommends the Chemical sector should be declared as essential and be exempt from lockdown. To ensure safe restart of the sector’s operations, ICC as the leading Indian Chemical Industry body, recognized by the International Council of Chemical Association (ICCA) has interacted with its peers in CEFIC (Europe) and ACC (America), and has procured guidelines on safe operations.

These guidelines include hygiene and sanitization at workplace, social distancing, and all other guidelines covering safe operations which are in line with the Government’s objectives of preventing the recurrence of any COVID-19 spread. Indian chemical industry is always pro-active and we are sure we will convert this adverse situation into new opportunities which will ultimately benefit Indian chemical industry and Indian economy with timely support from the ever cooperative government.

 Indian Chemical Council

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The Corona virus crisis has severely hit the Indian economy which was already under a severe slowdown. Sectors like automobiles, pharma, electronics, and chemicals are facing shortage of raw materials and essential components which gets manufactured in China. The Chemical & Petrochemical Industry has been among Hubei’s pillar industries, contributing much to China’s chemical exports which is suffering due to the closure of factories there. With the rapid COVID 19 outbreak, there has been a significant void in the supply and demand chain in India which is impacting India’s growth story at a larger extend.

India’s manufacturing sector is highly dependent on its Chinese counterparts for the supply of essential raw materials and components. With China still facing the brunt of Covid 19, it is impacting India extensively. But having said that, in order to bridge the gap and cut down the shortage of raw materials, India is on the track to become a self-sufficient nation with comparatively less dependency on other countries for import and export. There is a wide range of opportunities for domestic manufacturers to explore along with the government’s support to make India least dependent on other countries.

With Corona virus, there has been far reaching impact on various industries including chemical and petrochemical industry. The petrochemical and chemical industries have been traditionally among Hubei’s pillar industries, also contributing much to China’s chemical exports. India depends on China for chemicals across the value chain with the latter’s share in imports for broad categories ranging between 10 and 40%.

The Indian chemical sector needs to be future-ready for situations like these and there is a need to strengthen India’s domestic Chemical production base, which is the backbone of India’s industrial and agricultural development says Mr. H.S. Karangle, General Director, Indian Chemical Council.

 The chemical industry needs to better its feedstock allocation policy, government investments in chemical clusters across the country, easier access to capital due to its capital intensive nature, and simpler pollution compliance laws. Policies favoring the chemical sector will give a fillip to all industries dependent on this industry, from Led lights to electronics, from EVs to apparels, thereby giving a boost to the entire Indian economy.

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