In India's overall industrial economy, the chemical industry is a highly flexible division. It is one of India's oldest domestic industries, with a major contribution to both manufacturing and economic development. Almost any other manufacturing operation, such as food processing, metallurgy, textiles, rubber, and leather, is linked to it. There isn't a single industry category where chemicals aren't present. Inorganic chemicals, organic chemicals, petrochemicals-based specialties, and agro-oriented chemicals are the four main groups in the industry. Nearly 70,000 commercial products are produced by the chemical industry each year, ranging from cosmetics and toiletries to plastics and pesticides.
In the global market, Indian chemical companies are well-known. Because of favourable factors such as skilled labour, low production costs, and high domestic demand, global chemical companies operating in India have benefited from numerous opportunities. Agro-oriented chemicals such as guar gum, starch, citric acid, sorbitol, yeast, and others, valued at over Rs 1450 billion, contribute 14 percent of the industrial sector's GDP and account for 10% of India's overall exports. It is distributed over 2000 units, the majority of which are in the small-scale market. Nonetheless, the top 1% control more than a third of the industry. About 85% of the industry is made up of petrochemicals, pharmaceuticals, synthetic fibres, fertilisers and pesticides, paints, and dyestuffs. The remaining 15% consists of a diverse range of chemical intermediates, industrial, and specialty chemicals with a demand worth more than Rs 230 billion (including imports of about Rs 15 billion).
Specialty Chemicals
With a sales share of approximately 36%, Asia Pacific is the largest revenue contributor to the global specialty chemicals industry. China is the largest dominating market in the Asia Pacific region, accounting for more than 40% of revenue in specialty chemicals. The demand for specialty chemicals in Europe has remained steady. The region's high export rate of specialty chemicals, which accounted for nearly 27% of total exported chemicals in 2018, fueled regional growth in this industry.
Pharmaceutical ingredients dominated the global specialty chemicals industry in terms of sales share, and this dominance is expected to continue in the years ahead. The demand is growing due to the widespread use of specialty chemicals in the pharmaceutical industry, such as in the production of drugs for skin disorders, cardiovascular diseases, and Hughes syndrome.
The global specialty chemicals market is projected to hit USD 844.2 billion by 2027, growing at a CAGR of 3.7 percent over the forecast period. One of the primary industry growth drivers is projected to be the superior performance of specialty chemicals as compared to their traditional counterparts. Specialty chemicals accounted for more than 25.0 percent of total output in the EU area in FY 2018, according to the European Chemical Industry Council (Cefic). Raising disposable income, rising awareness, healthcare spending, construction spending, infrastructure creation, and population growth are all factors that are likely to boost product sales through end-use industries like construction, personal care and cosmetics, pharmaceuticals and nutraceuticals, food, automobile, and electronics. It is also expected to increase as a result of rising customer demand for energy, which has fueled commodity use in the oil and gas end-use industries.
With nearly 48 percent of investment, the chemical industry remains concentrated in the western region. Gujarat contributes the most to the chemical industry's development operation in the western region. In the next ten years, the Indian petrochemicals market will grow fourfold. In the coming years, it will continue to rise at a double-digit pace. The chemical industry in India will be one of the most booming industries in the coming years, thanks to India's developing economy, high growth rates, and strong domestic demand.