Contribution of Chemical Industry in Indian Economy
Chemical industry is undoubtedly the fastest expanding industries in Indian economy. It is also the oldest industry that begun soon after the country attained its independence in 1947. From that time, the industry has continued to contribute to the economic growth of the country and currently, it accounts for close to 13% of India’s gross domestic product.
The industry’s total exports grow annually at a rate of roughly 10 to 12 %. The industry is based on concept of diversification as such it is a multi-faceted and multi-product one. Depending on product categories, the industry can be divided into different sectors which include inorganic chemicals, pharmaceuticals and drugs, petrochemicals and plastics, fertilizers, pesticides, fine and specialty products such as dyes, polymers paints and other kinds of chemical products.
Through a decade of reforms in economic sector, major changes have been effected in the manner chemical industries in India operate and work. Success stories in the agrochemicals and dyes sections have boosted confidence of manufacturers who have in turn geared up and taking new challenges. The industry offers numerous benefits some of which are as highlighted below:
- Because the country is close to the Middle East, it has high value addition capacity. This is an ample and affordable petrochemical feed source.
- The cost infrastructure in the country is low and as such, it has a high expert potential. According to a report released recently, the country has the potential to reach US$ billion by the year 2015.
- In certain chemical categories, India enjoys exports advantage through establishing alliances with countries such as Russia. Also, the knowhow and expertise that is in the country means there is a huge potential in the agrochemical and dyestuff market.
- Abundance and availability of raw materials in the sector from agro based and titanium dioxide products India has the opportunity to enjoy value addition.
Growing at a 12.5 percent rate, the chemical industry in India offers a range of opportunities for local and international investors interested in the industry. The potential of the market is a major one and once this is coupled with the existing HR resources and comprehensive resources in the country, India becomes the most profitable destination especially in this new millennium. In the global production of chemicals, India stands at position 12. It is all these aspects and more that make the industry one of the major contributors to the overall gross domestic product. Also, it continues to attract investors from different parts of the globe largely because of the high profit margins the industry offers.
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