Indian Chemical Industry MRP

Export of chemical from India to U.S.
1. INTRODUCTION
INDIAN CHEMICAL INDUSTRY
1.1 HISTORY
Chandler (2005) argues the relative success or failure of American and European chemical
companies is explained with reference to three themes: "barriers to entry," "strategic
boundaries," and "limits to growth." He says successful chemical firms followed definite "paths
of learning" whereby first movers and close followers created entry barriers to would-be rivals
by building "integrated learning bases" (or organizational capabilities) which enabled them to
develop, produce, distribute, and sell in local and then worldwide markets. Also they followed a
"virtuous strategy" of reinvestment of retained earnings and growth through diversification,
particularly to utilize "dynamic" scale and scope economies relating to new learning in launching
"next generation" products.
1.1.1 Companies in 21st century
The chemical industry includes large, medium, and small companies that are located worldwide.
Companies with sales of chemical products greater than $10 billion dollars in fiscal year 2007
are shown below. For some of these companies the chemical sales might represent only a portion
of their total sales; (for example ExxonMobil’s chemical sales were only 8.7 percent of their
total sales in 2005).
International Institute of Foreign Trade and research, Indore
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2007 Chemical Sales,

COMPANY, HEADQUARTERS Rank Country
billions
BASF SE, Ludwigshafen, Germany $65.3 1
Dow Chemical, Midland, Michigan, USA $53.5 2
INEOS, Lyndhurst, UK $43.6 3
LyondellBasell, Houston, Texas, USA $42.8 4
Formosa Plastics, Taiwan $31.9 5
DuPont, Wilmington, Delaware, USA $28.5 6
Saudi Basic Industries Corporation, Riyadh, Saudi

$26.4 7
Arabia
Bayer, AG, Leverkusen, Germany $24.2 8
Mitsubishi Chemical, Tokyo, Japan $22.2 9
Akzo Nobel/Imperial Chemical Industries(ICI),

$19.9 10
Amsterdam/London
Air Liquide, Paris, France $16.3 11
Sumitomo Chemical, Tokyo, Japan $15.2 12
Evonik Industries, AG, Essen, Germany $15.0 13
Mitsui Chemicals, Tokyo, Japan $14.3 14
Asahi Kasei, Tokyo, Japan $13.8 15
Toray Industries, Tokyo, Japan $13.1 16
Chevron Phillips, The Woodlands, Texas, USA $12.5 17
DSM NV, Heerlen, Netherlands $12.1 18
PPG Industries, Pittsburgh, Pennsylvania, USA $11.2 19
Shin-Etsu Chemical Co., Ltd., Tokyo, Japan $11.1 20
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The chemical industry is one of the oldest domestic industries in India, contributing
significantly to both the industrial and economic growth of the country since it achieved
independence in 1947. The chemical industry currently produces nearly 70,000 commercial
products, ranging from cosmetics and toiletries, to plastics and pesticides.
The chemical industry comprises the companies that produce industrial chemicals. It is
central to modern world economy, converting raw materials (oil, natural gas, air, water, metals,
minerals) into more than 70,000 different products.
The wide and diverse spectrum of products can be broken down into a number of
categories, including inorganic and organic (commodity) chemicals, drugs and pharmaceuticals,
plastics and petrochemicals, dyes and pigments, fine and specialty chemicals, pesticides and
agrochemicals, and fertilizers.
The Indian pesticide industry has advanced significantly in recent years, producing more
than 1,000 tons of pesticides annually. India is the 13th largest exporter of pesticides and
disinfectants in the world, and in terms of volume, is the 12th largest producer of chemicals. The
Indian agrochemical, petrochemical, and pharmaceutical industries are some of the fastest
growing sectors in the economy. With an estimated worth of $28 billion, it accounts for 12.5
percent of the country's total industrial production and 16.2 percent of the total exports from the
Indian manufacturing sector.
With a special focus on modernization, the Indian government takes an active role in
promoting and advancing the domestic chemical industry. The Department of Chemicals &
Petro-Chemicals, which has been part of the Ministry of Chemicals and Fertilizers since 1991, is
responsible for policy, planning, development, and regulation of the industry. In the private
sector, numerous organizations, including the Indian Chemical Manufacturers Association, the
Chemicals and Petrochemicals Manufacturers Association, and the Pesticides Manufacturers and
Formulators Association of India, all work to promote the growth of the industry and the export
of Indian chemicals. The Indian Chemical Manufacturers Association, for example, represents a
large number of Indian companies that produce and export a number of chemicals that have
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legitimate commercial applications, but also can be used as precursors and intermediates for
chemical weapons production.
The Chemical Industry in India constitutes of numerous chemical exporters, chemicals

manufacturers and chemicals suppliers dealing in fine chemicals, organic chemicals and
inorganic chemicals. The chemical and allied industries have been amongst the fastest growing
segments of the Indian industry. In recent years, there has been a significant increase in the
number of inorganic chemical exporters, chemical manufacturers and wholesalers of India. The
current annual turnover in the chemical sector is around Rs. 90,000 crore of which roughly one-
third is contributed by the three main sub-sectors, namely, chemicals, petrochemicals and
pharmaceuticals. The chemical industry sector, comprising of fine chemicals and organic and
inorganic chemicals, accounts for about 17 per cent of the country’s total industrial production
and 16 per cent of the export of manufactured goods.
1.1.2 OVERVIEW:
• Total US$30.59 Billion during 2005-2006 as per March 2007 report.

• Contributes to 3% of GDP in the same report.
• One of the fastest growing sectors of Indian economy.
• Chemical Industry in India is fragmented and dispersed - multi product and multi faceted.
• Chemicals sold directly to large customers and through distribution channels.
Distribution channels mostly consist of stockists and dealers spread all over India
addressing small segments and retail market.
1.1.3 SECTOR HIGHLIGHTS
• The Basic inorganic chemical and organic chemical industry constitutes a major segment
of the country's economy.
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• Important chemicals in this category are Soda Ash, Caustic Soda, Liquid Chlorine,
Calcium Carbide, and Acetic Acid. Methanol, Formaldehyde, Phenol, Acetone.
• These are raw materials for industries like detergents, toothpaste, plastics, drugs,
petroleum refining, etc.
• 10% of the Chloe-Caustic Plants use Membrane Cell Technology, which will find higher
usage, as no new capacities are allowed for the mercury cell process.
1.2 Products
Polymers and plastics, especially polyethylene, polypropylene, polyvinyl chloride, polyethylene

terephthalate, polystyrene and polycarbonate comprise about 80% of the industry’s output
worldwide. Chemicals are used to make a wide variety of consumer goods, as well as thousands
inputs to agriculture, manufacturing, construction, and service industries. The chemical industry
itself consumes 26 percent of its own output. Major industrial customers include rubber and
plastic products, textiles, apparel, petroleum refining, pulp and paper, and primary metals.
Chemicals is nearly a $3 trillion global enterprise, and the EU and U.S. chemical companies are
the world's largest producers.
1.2.1 Product Category Breakdown
Sales of the chemical business can be divided into a few broad categories, including basic
chemicals (about 35 to 37 percent of the dollar output), life sciences (30 percent), specialty
chemicals (20 to 25 percent) and consumer products (about 10 percent).
Basic chemicals, or "commodity chemicals" are a broad chemical category including polymers,
bulk petrochemicals and intermediates, other derivatives and basic industrials, inorganic
chemicals, and fertilizers. Typical growth rates for basic chemicals are about 0.5 to 0.7 times
GDP. Product prices are generally less than fifty cents per pound. Polymers, the largest revenue
segment at about 33 percent of the basic chemicals dollar value, includes all categories of
plastics and man-made fibers. The major markets for plastics are packaging, followed by home
construction, containers, appliances, pipe, transportation, toys, and games. The largest-volume
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polymer product, polyethylene (PE), is used mainly in packaging films and other markets such
as milk bottles, containers, and pipe. Polyvinyl chloride (PVC), another large-volume product, is
principally used to make pipe for construction markets as well as siding and, to a much smaller
extent, transportation and packaging materials. Polypropylene (PP), similar in volume to PVC, is
used in markets ranging from packaging, appliances, and containers to clothing and carpeting.
Polystyrene (PS), another large-volume plastic, is used principally for appliances and packaging
as well as toys and recreation. The leading man-made fibers include polyester, nylon,
polypropylene, and acrylics, with applications including apparel, home furnishings, and other
industrial and consumer use. The principal raw materials for polymers are bulk petrochemicals.
Chemicals in the bulk petrochemicals and intermediates are primarily made from liquefied
petroleum gas (LPG), natural gas, and crude oil. Their sales volume is close to 30 percent of
overall basic chemicals. Typical large-volume products include ethylene, propylene, benzene,
toluene, xylenes, methanol, vinyl chloride monomer (VCM), styrene, butadiene, and ethylene
oxide. These chemicals are the starting points for most polymers and other organic chemicals as
well as much of the specialty chemicals category.
Other derivatives and basic industrials include synthetic rubber, surfactants, dyes and pigments,
turpentine, resins, carbon black, explosives, and rubber products and contribute about 20 percent
of the basic chemicals' external sales. Inorganic chemicals (about 12 percent of the revenue
output) make up the oldest of the chemical categories. Products include salt, chlorine, caustic
soda, soda ash, acids (such as nitric, phosphoric, and sulfuric), titanium dioxide, and hydrogen
peroxide. Fertilizers are the smallest category (about 6 percent) and include phosphates,
ammonia, and potash chemicals.
Life sciences (about 30 percent of the dollar output of the chemistry business) include
differentiated chemical and biological substances, pharmaceuticals, diagnostics, animal health
products, vitamins, and crop protection chemicals. While much smaller in volume than other
chemical sectors, their products tend to have very high prices—over ten dollars per pound—
growth rates of 1.5 to 6 times GDP, and research and development spending at 15 to 25 percent
of sales. Life science products are usually produced with very high specifications and are closely
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scrutinized by government agencies such as the Food and Drug Administration. Crop protection
chemicals, about 10 percent of this category, include herbicides, insecticides, and fungicides.
Specialty chemicals are a category of relatively high valued, rapidly growing chemicals with
diverse end product markets. Typical growth rates are one to three times GDP with prices over a
dollar per pound. They are generally characterized by their innovative aspects. Products are sold
for what they can do rather than for what chemicals they contain. Products include electronic
chemicals, industrial gases, adhesives and sealants as well as coatings, industrial and institutional
cleaning chemicals, and catalysts. Coatings make up about 15 percent of specialty chemicals
sales, with other products ranging from 10 to 13 percent.
Specialty Chemicals are sometimes referred to as "fine chemicals"
Consumer products include direct product sale of chemicals such as soaps, detergents, and
cosmetics. Typical growth rates are 0.8 to 1.0 times GDP.
Every year, the American Chemistry Council tabulates the U.S. production of the top 100 basic
chemicals. In 2000, the aggregate production of the top 100 chemicals totaled 502 million tons,
up from 397 million tons in 1990. Inorganic chemicals tend to be the largest volume, though
much smaller in dollar revenue terms due to their low prices. The top 11 of the 100 chemicals in
2000 were sulfuric acid (44 million tons), nitrogen (34), ethylene (28), oxygen (27), lime (22),
ammonia (17), propylene (16), polyethylene (15), chlorine (13), phosphoric acid (13) and
diammonium phosphates (12).
1.3 Companies
The largest corporate producers worldwide, with plants in numerous countries, are BASF, Dow,
Degussa, Eastman Chemical Company, Shell, Bayer, INEOS, ExxonMobil, DuPont, SABIC,
Braskem and Mitsubishi, along with thousands of smaller firms.
In the U.S. there are 170 major chemical companies. They operate internationally with more than
2,800 facilities outside the U.S. and 1,700 foreign subsidiaries or affiliates operating. The U.S.
chemical output is $400 billion a year. The U.S. industry records large trade surpluses and
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employs more than a million people in the United States alone. The chemical industry is also the
second largest consumer of energy in manufacturing and spends over $5 billion annually on
pollution abatement.
In Europe, especially Germany, the chemical, plastics and rubber sectors are among the largest
industrial sectors. Together they generate about 3.2 million jobs in more than 60,000 companies.
Since 2000 the chemical sector alone has represented 2/3 of the entire manufacturing trade
surplus of the EU. The chemical sector accounts for 12% of the EU manufacturing industry's
added value.
The chemical industry has shown rapid growth for more than fifty years. The fastest growing
areas have been in the manufacture of synthetic organic polymers used as plastics, fibres and
elastomers. Historically and presently the chemical industry has been concentrated in three areas
of the world, Western Europe, North America and Japan (the Triad). The European Community
remains the largest producer area followed by the USA and Japan.
The traditional dominance of chemical production by the Triad countries is being challenged by
changes in feedstock availability and price, labour cost, energy cost, differential rates of
economic growth and environmental pressures. Instrumental in the changing structure of the
global chemical industry has been the growth in China, India, Korea, the Middle East, South
East Asia, Nigeria, and Brazil.
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1.4 Technology
This is a process diagram of a turbine generator. Knowing how to design a sustainable process in
which the system can withstand or manipulate process halting conditions such as; heat, fiction,
pressure, emissions, contaminants, is essential for engineers working to produce a sustainable
process for use in the chemical industry.
As accepted by chemical engineers, the chemical industry involves the use of chemical processes
such as chemical reactions and refining methods to produce a wide variety of solid, liquid, and
gaseous materials. Most of these products are used in manufacture of other items, although a
smaller number are used directly by consumers. Solvents, pesticides, lye, washing soda, and
portland cement are a few examples of product used by consumers. The industry includes
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manufacturers of inorganic- and organic-industrial chemicals, ceramic products, petrochemicals,

agrochemicals, polymers and rubber (elastomers), oleochemicals (oils, fats, and waxes),
explosives, fragrances and flavors. Examples of these products are shown in the Table below.
Product Type Examples
inorganic industrial ammonia, nitrogen, sodium hydroxide, sulfuric acid, nitric acid
organic industrial acrylonitrile, phenol, ethylene oxide, urea
ceramic products silica brick, frit
petrochemicals ethylene, propylene, benzene, styrene
agrochemicals fertilizers, insecticides, herbicides
polymers polyethylene, Bakelite, polyester
elastomers polyisoprene, neoprene, polyurethane
oleochemicals lard, soybean oil, stearic acid
explosives nitroglycerin, ammonium nitrate, nitrocellulose
fragrances and flavors benzyl benzoate, coumarin, vanillin
Although the pharmaceutical industry is often considered a chemical industry , it has many
different characteristics that puts it in a separate category. Other closely related industries
include petroleum, glass, paint, ink, sealant, adhesive, and food processing manufacturers.
Chemical processes such as chemical reactions are used in chemical plants to form new
substances in various types of reaction vessels. In many cases the reactions are conducted in
special corrosion resistant equipment at elevated temperatures and pressures with the use of
catalysts. The products of these reactions are separated using a variety of techniques including
distillation especially fractional distillation, precipitation, crystallization, adsorption, filtration,
sublimation, and drying. The processes and product or products are usually tested during and
after manufacture by dedicated instruments and on-site quality control laboratories to insure safe
operation and to assure that the product will meet required specifications. The products are
packaged and delivered by many methods, including pipelines, tank-cars, and tank-trucks (for
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both solids and liquids), cylinders, drums, bottles, and boxes. Chemical companies often have a
research and development laboratory for developing and testing products and processes. These
facilities may include pilot plants, and such research facilities may be located at a site separate
from the production plant(s).
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1.5 TYPES OF CHEMICALS
1.5.1 Organic And Inorganic Chemicals
The state of development of this particular subsector is evident from the fact that the
indigenous production of caustic soda, a versatile chemical with extensive industrial application,
which was hardly 11,000 tonnes in 1950, has increased to about 1.74 million tonnes now. The
production of soda ash, yet another versatile chemical with varied industrial application as well
as basic washing powder in households, has grown from the level of about 45,000 tonnes in
1950 to over 1 million tonnes at present.
The manufacture of other chemicals like carbon black, calcium carbide and phosphoric
acid is well established. Self-sufficiency has almost been achieved. The development of the
organic chemical industry, which, in the initial years after Independence, was based on the ethyl
alcohol derived from sugar-cane molasses, is now based largely on feed-stock derived from
petroleum.
In the dye stuff and dye-intermediates, the country has more than 50 units in the
organised sector with a total installed capacity of over 55,000 tonnes per annum. A large
quantity of dyes and dye intermediates are being exported.
The pesticides and insecticides sub-sector has, similarly, made impressive progress since
the first factory was set up in the 1950s. As of now, about 60 different grades of technical
pesticides are produced indigenously and converted into formulations by over 500 units. The
production in the country is about 1,00,000 tonnes annually.
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1.5.1.1 Inorganic Chemicals
• US$ 2.5 Billion industry.
• Covers basic products like Caustic, Chlorine, Sulphuric Acid etc.
• Inorganic chemicals mostly used in detergents, glass, soap, fertiliser, alkalies etc.
• Competition from imports are on the rise.
1.5.1.2 Organic Chemicals
• 1 Billion Dollar industry.
• Covers a wide range of chemicals.
• Units concentrated mostly in the Western India.
1.5.2 DRUGS AND PHARMACEUTICALS:
The Indian Pharmaceutical Industry is the largest in the developing world. The industry
currently produces a wide range of bulk drugs. In fact, India is currently a world leader in
manufacture and export of basic drugs such as ethambutol and ibuprofen.300 bulk drugs &
formulation based on them are manufactured in the country. There are 10,000 manufacturing
units, of which 290 units are in the large-scale sector, 45 Multi-National Companies (MNCs)
have manufacturing bases here.
1.5.3 PESTICIDES AND AGROCHEMICALS:
India is currently the largest manufacturer of Pesticides in Asia. Second only to Japan. The
pesticides demand from the agriculture sector is expected to go up to 97,000 tonnes by the year
2000. More than 60 technical grade pesticide is manufactured indigenously. Some 125 units are
engaged in the manufacture of the above and over 500 units are making pesticide formulations.
In agrochemical, we manufacture significant quantities of synthetic pyrethroids, such as

fenvalerate and cypermethrin, endosulphane, and organophosphate range of agrochemicals,
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including monocrotophos. India is also a dominant producer of isoproturon, a weedicide

accounting for nearly 25% of the world-wide production.
A pesticide is any substance or mixture of substances intended for preventing, destroying,

repelling or mitigating any pest. A pesticide may be a chemical substance, biological agent (such
as a virus or bacterium), antimicrobial, disinfectant or device used against any pest. Pests include
insects, plant pathogens, weeds, molluscs, birds, mammals, fish, nematodes (roundworms), and
microbes that destroy property, spread disease or are a vector for disease or cause a nuisance.
Although there are benefits to the use of pesticides, there are also drawbacks, such as potential
toxicity to humans and other animals. FAO has defined the term of pesticide as:
any substance or mixture of substances intended for preventing, destroying or controlling any
pest, including vectors of human or animal disease, unwanted species of plants or animals
causing harm during or otherwise interfering with the production, processing, storage, transport
or marketing of food, agricultural commodities, wood and wood products or animal feedstuffs,
or substances which may be administered to animals for the control of insects, arachnids or other
pests in or on their bodies. The term includes substances intended for use as a plant growth
regulator, defoliant, desiccant or agent for thining fruit or preventing the premature fall of fruit,
and substances applied to crops either before or after harvest to protect the commodity from
deterioration during storage and transport.
Pesticides are used to control organisms considered harmful. For example, they are used to kill
mosquitoes that can transmit potentially deadly diseases like west nile virus, yellow fever, and
malaria. They can also kill bees, wasps or ants that can cause allergic reactions. Insecticides can
protect animals from illnesses that can be caused by parasites such as fleas. Pesticides can
prevent sickness in humans that could be caused by mouldy food or diseased produce.
Herbicides can be used to clear roadside weeds, trees and brush. They can also kill invasive
weeds that may cause environmental damage. Herbicides are commonly applied in ponds and
lakes to control algae and plants such as water grasses that can interfere with activities like
swimming and fishing and cause the water to look or smell unpleasant. Uncontrolled pests such
as termites and mould can damage structures such as houses. Pesticides are used in grocery
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stores and food storage facilities to manage rodents and insects that infest food such as grain.
Each use of a pesticide carries some associated risk. Proper pesticide use decreases these
associated risks to a level deemed acceptable by pesticide regulatory agencies such as the United
States Environmental Protection Agency (EPA) and the Pest Management Regulatory Agency
(PMRA) of Canada.
Pesticides can save farmers' money by preventing crop losses to insects and other pests; in the
U.S., farmers get an estimated fourfold return on money they spend on pesticides. One study
found that not using pesticides reduced crop yields by about 10%. Another study,conducted in
1999, found that a ban on pesticides in the United States may result in a rise of food prices, loss
of jobs, and an increase in world hunger.
DDT, sprayed on the walls of houses, is an organochloride that has been used to fight malaria
since the 1950s. Recent policy statements by the World Health Organization have given stronger
support to this approach. Dr. Arata Kochi, WHO's malaria chief, said, "One of the best tools we
have against malaria is indoor residual house spraying. Of the dozen insecticides WHO has
approved as safe for house spraying, the most effective is DDT."[19] However, since then, an
October 2007 study has linked breast cancer from exposure to DDT prior to puberty. Poisoning
may also occur due to use of DDT and other chlorinated hydrocarbons by entering the human
food chain when animal tissues are affected. Symptoms include nervous excitement, tremors,
convulsions or death. Scientists estimate that DDT and other chemicals in the organophosphate
class of pesticides have saved 7 million human lives since 1945 by preventing the transmission
of diseases such as malaria, bubonic plague, sleeping sickness, and typhus. However, DDT use is
not always effective, as resistance to DDT was identified in Africa as early as 1955, and by 1972
nineteen species of mosquito worldwide were resistant to DDT. A study for the World Health
Organization in 2000 from Vietnam established that non-DDT malaria controls were
significantly more effective than DDT use. The ecological effect of DDT on organisms is an
example of bioaccumulation.
Agrochemical (or agrichemical), a contraction of agricultural chemical, is a generic term for

the various chemical products used in agriculture. In most cases, agrichemical refers to the broad
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range of pesticides, including insecticides, herbicides, and fungicides. It may also include
synthetic fertilizers, hormones and other chemical growth agents, and concentrated stores of raw
animal manure.
Many agrichemicals are toxic, and agrichemicals in bulk storage may pose significant
environmental and/or health risks, particularly in the event of accidental spills. In many
countries, use of agrichemicals is highly regulated. Government-issued permits for purchase and
use of approved agrichemicals may be required. Significant penalties can result from misuse,
including improper storage resulting in spillage. On farms, proper storage facilities and labeling,
emergency clean-up equipment and procedures, and safety equipment and procedures for
handling, application and disposal are often subject to mandatory standards and regulations.
Usually, the regulations are carried out through the registration process.
According to Agrow, Bayer CropScience led the agrichemical industry in sales in 2007.
Syngenta was second, followed by BASF, Dow Agrosciences, Monsanto, and DuPont.
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1.5.4 PETROCHEMICALS:
The petrochemical industry of India is less than 40 years old. The sector has a significant
growth potential. Although the current per capita consumption of petrochemicals products is
low, the demand for the same is growing : 10% during the Sixth Plan, 13.2% during the Seventh
Plan, 25% expected during the Eight Plan.
In contrast, during the last seven years or so, the consumption of polymers and plastics
increased by more than a million tonnes. Neverthless, India’s per capita consumption of plastics
is around 2 kilograms which is far less than the consumption levels of about 17 kilograms of the
developed world and even less than the per capita consumption of 6 kilograms in Latin America
and about 8 kilograms in China.
Petrochemicals are no longer considered an elitist material. They serve to effect cost and
energy saving. What is more, they find wide application in the domestic and industrial sectors.
Synthetic fibres play a critical role in supplementing natural fibres such as cotton and wool to
cater to the clothing needs of India’s vast population. Synthetic rubber supplements natural
rubber. Engineering plastics have substituted scarce metals.
It is, however, in plastics that the revolution is on a grand scale. With their
versatile applications, plastics are in every home, office and public place. Metal buckets are now
replaced by light weight, multi-colour, better-looking products, glass milk bottles have been
replaced by cheaper and easily manageable pouches, wooden crates for cold drinks have been
substituted by plastic crates and wood and steel chairs have given way to chairs made of
polypropylene. The list could go on. The crux is that plastics are and will remain an integral part
of human existence.
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Petrochemicals are chemical products derived from petroleum. Some chemical compounds made
from petroleum are also obtained from other fossil fuels such as coal or natural gas, or renewable
sources such as corn or sugar cane.
This article focuses on organic compounds that are not burned as fuel Two petrochemical classes
are olefins including ethylene and propylene, and aromatics including benzene, toluene and
xylene isomers. Oil refineries produce olefins and aromatics by fluid catalytic cracking of
petroleum fractions. Chemical plants produce olefins by steam cracking of natural gas liquids
like ethane and propane. Aromatics are produced by catalytic reforming of naphtha. Olefins and
aromatics are the building blocks for a wide range of materials such as solvents, detergents, and
adhesives. Olefins are the basis for polymers and oligomers used in plastics, resins, fibers,
elastomers, lubricants, and gels.
Global ethylene and propylene production are ~110 million tonnes and ~65 million tonnes per
annum respectively. Aromatics production is ~70 million tonnes. The largest petrochemical
industries are located in the USA and Western Europe; however, major growth in new
production capacity is in the Middle East and Asia. There is substantial inter-regional
petrochemical trade.
Primary petrochemicals are divided into three groups depending on their chemical structure:
• Olefins includes ethylene, propylene, and butadiene. Ethylene and propylene are
important sources of industrial chemicals and plastics products. Butadiene is used in
making synthetic rubber.
• Aromatics includes benzene, toluene, and xylenes. Benzene is a raw material for dyes
and synthetic detergents, and benzene and toluene for isocyanates MDI and TDI used in
making polyurethanes. Manufacturers use xylenes are used to produce plastics and
synthetic fibers.
• Synthesis gas is a mixture of carbon monoxide and hydrogen used to make ammonia and
methanol. Ammonia is used to make the fertilizer urea and methanol is used as a solvent
and chemical intermediate.
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1.5.4.1 Petrochemicals products
Petrochemicals Polymers & Fibers Petroleum Chemicals Healthcare
Basic Feedstock Acrylic fiber Lubricants Adhesives and Health care

Butadiene Acrylonitrile Additives sealants Pharmaceutical
Ethylene butadiene styrene Catalysts Agrochemicals
Para-xylene (ABS) Marine fuel Construction
Propylene Acrylonitrile styrene oil chemicals
(AS) Petroleum Corrosion control
Intermediates
Polybutadiene (PBR) refining chemicals
2-Ethylhexanol (2-EH)
Polyvinyl chloride Cosmetics raw
Acetic acid
(PVC) materials
Acrylonitrile (AN)
Polyethylene (PE) Electronic chemicals
Ammonia
Polyethylene and materials
Bis(2-ethylhexyl)
terephthalate (PET) Flavourings,
phthalate (dioctyl
Polyol fragrances, food
phthalate)
Polypropylene (PP) additives
n-Butene
Polystyrene (PS) Specialty and
Cyclohexane
Styrene butadiene industrial chemicals
Dimethyl terephthalate
(SBR) Specialty and
(DMT)
Urea-formaldehyde industrial gases
Dodecylbenzene
(UF) Inks, dyes and
Ethanol
printing supplies
Ethanolamine
Packaging, bottles,
Ethoxylate
and containers
1,2-Dichloroethane
Paint, coatings, and
(ethylene dichloride or
resins
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EDC)
Ethylene glycol (EG)
Ethylene oxide (EO)
Formaldehyde
n-Hexene
Linear alkylbenzene
(LAB)
Methanol Polymer additives
Methyl tert-butyl ether Specialty and life
(MTBE) sciences chemicals
Phenol Surfactants and
Propylene oxide]] cleaning agents
Purified terephthalic acid
(PTA)
Styrene monomer (SM)
Urea
Vinyl acetate monomer
(VAM)
Vinyl chloride monomer
(VCM)
1.5.4.2 SEGMENT HIGHLIGHTS:

• The major category in the chemicals
• One of the fastest sectors at 13% p.a.
• Covers:
o Basic chemicals like Ethylene, Propylene, Benzene and Xylene etc.
o Intermediates like MEG, PAN and LAB etc.
o Synthetic fibres like Nylon, PSF and PFY etc.
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o Polymers like LDPE/HDPE, PVC, Polyester and PET etc.

o Synthetic rubber like SBR, PBR etc.
• Major players are Reliance, IPCL, NOCIL, Haldia and GAIL etc.
1.5.4.3 PETROCHEMICAL MAJOR PLAYERS:
Reliance Industries Ltd. - 750,000 TPA Ethylene

- 400,000 TPA Propylene
- 27,000,000 TPA refinery
IPCL Baroda - 300,000 TPA
Nagothane - 300,000 TPA
Gandhar - 400,000 TPA
Haldia Petrochem - 420,000 TPA Ethylene

- 200,000 TPA Propylene
GAIL - 300,000 TPA Ethylene
NOCIL -150,000 TPA
1.5.5 DYES AND PIGMENTS:
A dye can generally be described as a colored substance that has an affinity to the substrate to
which it is being applied. The dye is generally applied in an aqueous solution, and may require a
mordant to improve the fastness of the dye on the fiber.
Both dyes and pigments appear to be colored because they absorb some wavelengths of light
preferentially. In contrast with a dye, a pigment generally is insoluble, and has no affinity for the
substrate. Some dyes can be precipitated with an inert salt to produce a lake pigment, and based
on the salt used they could be aluminum lake, calcium lake or barium lake pigments.
Dyed flax fibers have been found in the Republic of Georgia dated back in a prehistoric cave to
36,000 BP.[1][2] Archaeological evidence shows that, particularly in India and Phoenicia, dyeing
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has been extensively carried out for over 5000 years. The dyes were obtained from animal,
vegetable or mineral origin, with no or very little processing. By far the greatest source of dyes
has been from the plant kingdom, notably roots, berries, bark, leaves and wood, but only a few
have ever been used on a commercial scale.
A pigment is a material that changes the color of reflected or transmitted light as the result of
wavelength-selective absorption. This physical process differs from fluorescence,
phosphorescence, and other forms of luminescence, in which a material emits light.
Many materials selectively absorb certain wavelengths of light. Materials that humans have
chosen and developed for use as pigments usually have special properties that make them ideal
for coloring other materials. A pigment must have a high tinting strength relative to the materials
it colors. It must be stable in solid form at ambient temperatures.
For industrial applications, as well as in the arts, permanence and stability are desirable
properties. Pigments that are not permanent are called fugitive. Fugitive pigments fade over
time, or with exposure to light, while some eventually blacken.
Pigments are used for coloring paint, ink, plastic, fabric, cosmetics, food and other materials.
Most pigments used in manufacturing and the visual arts are dry colourants, usually ground into
a fine powder. This powder is added to a vehicle (or binder), a relatively neutral or colorless
material that suspends the pigment and gives the paint its adhesion.
The worldwide market for inorganic, organic and special pigments had a total volume of around
7.4 million tons in 2006. Asia has the highest rate on a quantity basis followed by Europe and
North America. In 2006, a turnover of 17.6 billion US$ (13 billion euro) was reached mostly in
Europe, followed by North America and Asia.
A distinction is usually made between a pigment, which is insoluble in the vehicle (resulting in a
suspension), and a dye, which either is itself a liquid or is soluble in its vehicle (resulting in a
solution). The term biological pigment is used for all colored substances independent of their
solubility. A colorant can be both a pigment and a dye depending on the vehicle it is used in. In
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some cases, a pigment can be manufactured from a dye by precipitating a soluble dye with a
metallic salt. The resulting pigment is called a lake pigment.
There are about 50 units in the organised sector and about 900 units in the small scale
sector.
The Installed Capacity:
• 37,000 MTA Organised Sector
• 10,000 MTA Small Scale Sector
Nearly 80% of the dyes manufactured is utilised by the textile industry, with the balance
going to into paints, printing inks, rubber & leather.
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1.5.6 FINE AND SPECIALITY CHEMICALS:
70% of the Fine Chemicals produced in India find their way into the Pharmaceutical and
Agrochemical sectors. Performance chemicals geared to customer need are being developed
locally particularly since there is growing demand for Speciality chemicals like Sunscreens,
Antioxidants, Biocides, etc.
Manufacturers of Fine Chemicals and specialities have major strengths in basic research
facilities available with CSIR laboratories such as NCL, IICT & RRls as also corporate R & D
centres. This ensures that development of process know-how; plant process design and
engineers, detailed engineering design, commissioning assistance and even consultancy for re-
engineering are available at low cost.
• Low volume, high price/margin chemicals
• Fragmented with large number of players
• Major Players
o India: ION Exchange, Balmer Lawrie, Dai Ichi Karkaria. etc.
o MNC: Ciba, Hoechst, Foseco, Nalco Chemicals, Clariant, ICI etc.
o And many small Indian companies
• Market around US$ 80 million p.a.
• Major end user segments - Textile, Leather, paper, detergent, rubber, paints, polyester, oil
and gas etc.
• Growing very fast
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1.5.7 FERTILIZERS:
Fertilizers are soil amendments applied to promote plant growth; the main nutrients present in
fertilizer are nitrogen, phosphorus, and potassium (the 'macronutrients') and other nutrients
('micronutrients') are added in smaller amounts. Fertilizers are usually directly applied to soil,
and also sprayed on leaves ('foliar feeding').
Fertilizers are roughly broken up between organic and inorganic fertilizer, with the main
difference between the two being sourcing, and not necessarily differences in nutrient content.
Organic fertilizers and some mined inorganic fertilizers have been used for many centuries,
whereas chemically synthesized inorganic fertilizers were only widely developed during the
industrial revolution. Increased understanding and use of fertilizers were important parts of the
pre-industrial British Agricultural Revolution and the industrial green revolution of the 20th
century.
Fertilizers typically provide, in varying proportions:
• the three primary macronutrients: nitrogen (N), phosphorus (P), and potassium (K).
• the three secondary macronutrients: calcium (Ca), sulfur (S), magnesium (Mg).
• and the micronutrients or trace minerals: boron (B), chlorine (Cl), manganese (Mn), iron
(Fe), zinc (Zn), copper (Cu), molybdenum (Mo) and selenium (Se).
The macronutrients are consumed in larger quantities and are present in plant tissue in quantities
from 0.2% to 4.0% (on a dry matter weight basis). Micronutrients are consumed in smaller
quantities and are present in plant tissue in quantities measured in parts per million (ppm),
ranging from 5 to 200 ppm, or less than 0.02% dry weight.
The Indian fertilizer industry has emerged as the fourth largest producer of fertilizers in
the world after China, USA, Russia. Nitrogenous and phosphatic fertilizers are produced
indigenously, while requests for potassic fertilizers are met through imports.
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India has achieved near self-sufficiency in the inputs for the production of nitrogenous
fertilizers, but for the production of phosphatic fertilizers, the country continues to rely on
imports of raw materials (rock phosphate and sulphur and for intermediates such as phosphoric
acid).
• India is a large agricultural economy which is the major user. Average Indian
consumption is very low (1/20th of world average)
• Market size 100,000 MT (in terms of technical grade)
o US$ 800 million
o Growth 10% pa
• Consumption varies depending on crop and region
• Cash crops like sugarcane, tobacco etc. are the major consumers of pesticides (above
60%)
• Two types of producers - Technical - 40 nos.
o Formulators - above 500 nos.
• Major players
o India: United Phosphorus, Rallis and Excel
o MNC: Hoechst Agrevo, Novartis, Bayer etc
• Significant exports
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1.6 EFFECT OF GLOBAL SLOWDOWN
Global economic meltdown has ripple effects on each sector of the Industry. Apart from
Financial, banking and interest rate sensitive sectors, other sectors are also in the grip of the
recessionary pressure. Among them, Chemical is one of the worst hit sector. Drastic fall in the
prices, slump in the export orders and substantial demand slowdown in domestic market have
forced the Chemical Industries to cut expansion plans and shutdown the plants till the situation
improves.
1.6.1 HEAVY FALL IN THE PRICES

Over the last 3 months, chemical prices have tumbled sharply in global markets, which
have led to heavy fall in Indian Market also. Fall in raw material prices resulted into decline in
finished products prices. As crude oil prices have fallen from $147 per barrel in mid-July to $
40-45 at present, all chemicals, solvents, polymers and petrochemicals have also fallen by that
extent. Currently prices of many chemicals are prevailing at level of 2002-03. The prices of
sulfuric acid prices have come down from 13,000 a tonnes to Rs. 200 a tonnes. Similarly, sulfur
prices have dipped to Rs. 44 a kg to Rs. 4 a kg within last couple of months. There has been 33%
to 50 % price fall in various chemical prices.
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Fall in Prices in Last 3 months

Chemicals % Decrease
Sulphuric Acid 98
Sulphur 91
Chlorosulphonic Acid 84
Sodium nitrite 82
Anniline 70
Acetic Acid 51
H Acid 47
Vinyl Sulfone 35
Benezene 34
DEG 42
Plasticiser 40
Ortho zylene 70
1.6.2 DROP IN EXPORTS

Global slowdown has severely affected exports of Chemicals from India to US, Europe
and other markets. Considering substantial drop in chemicals prices and liquidity crunch,
chemical importers are demanding heavy discounts from chemical exporters, which has led to
cancellation of many orders apart from blockage of chemical consignment from India. Buyers
from overseas markets are refusing to take the delivery of chemicals dispatched by Indian
exporters. Foreign buyers are also demanding 25 to 30 % discounts. Discounts have been sought
even in case where material has already been shipped from India.
The Chemical exporters were expecting recovery in demand post- Olympic, which has
not happened. To survive in this time, some producers have started to convert EoU (Export
Oriented Unit) into unit which can sell goods in domestic area (DTA).
Apart from slowdown, policy measures related to environment concern also affecting the
exports. European Union (EU) has tightened the import rules for chemicals. Market access for
chemical exports to the European Union (EU) may become limited. The new chemical policy of
EU is aimed at ensuring protection from risks that chemicals may pose to human health and the
environment through generation and dissemination of information on chemicals. As per the new
policy, compliance would require exporters to conduct extensive tests to generate data, which
will result in extra cost and lower margins.
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1.6.3 PRODUCTION CUTS

A demand slowdown and credit squeeze has lead to lower off-take of the chemicals
across the industry including organic, inorganic, petrochem and polymers even as prices have
fallen dramatically in last three months. As demand for homes, offices and cars declined which
resulted in decrease demand of chemicals from Automobile makers, Construction companies and
also from Textile manufacturers. It has also resulted in many Asian refineries running at an
average of about 80% capacities and further production cuts are expected. Indian chemical
manufacturers and refineries are also facing similar problems. Lower utilisation of refining
capacities and cases shutting down plants in the name of maintenance are frequent. The
perception of a further slowdown and fears of further fall in prices have resulted in lower
inventories or running production capacities with minimum stocks.
• Reliance Industries (RIL) has closed five of its seven polyester and petrochemical units
at Patalganga. The company has shut down plants for manufacturing polyester filament
yarn (PFY), polyester staple fibre (PSF), paraxylene (PX), purified terephthalic acid
(PTA) and linear alkyl benzene (LAB). However, it is yet to close down the second units
of PSF and PFY.
• Reliance Industries has also suspended operation of four units at the Vadodara
petrochemicals facility (formerly IPCL complex) in Gujarat. It stopped operations of
Acrylic fibre (24,000 tonnes per annum), acrylo nitrile (43,000 tpa), PVC (55,000 tpa)
and LAB (linear Alkyl benzene, 45,000 tpa) plants in the complex.
• Asian Paints, India’s biggest paint producer, has temporarily closed the company’s
chemical plant for a period from a week to a month.
By Namit Kumar
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1.7 COUNTRY PROFILE : USA
The USA is the world's foremost economic and military power, with global interests and
an unmatched global reach. America's gross domestic product accounts for close to a quarter of
the world total, and its military budget is reckoned to be almost as much as the rest of the world's
defence spending put together.
1.7.1 FACTS:
• Full name: United States of America

• Population: 308.8 million (UN, 2007)
• Capital: Washington DC
• Largest city: New York City
• Area: 9.8 million sq km (3.8 million sq miles)
• Major language: English
• Major religion: Christianity
• Life expectancy: 76 years (men), 81 years (women) (UN)
• Monetary unit: 1 US dollar = 100 cents
• Main exports: Computers and electrical machinery, vehicles, chemical products, food
and live animals, military equipment and aircraft
• GNI per capita: US $46,040 (World Bank, 2007)
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COUNTRY PROFILE
1.7.2 INDIA
1.7.2.1 OFFICIAL NAME: Republic of India
1.7.2.2 CAPITAL: New Delhi
1.7.2.3 SYSTEM OF GOVERNMENT: Multiparty Federal Republic
1.7.2.4 AREA: 3,166,692 Sq Km (1,222,720 Sq Mi)
1.7.2.5 ESTIMATED 2000 POPULATION 1,096,695,000
1.7.2.6 LOCATION & GEOGRAPHY: India is located on the Indian sub-continent in South
Asia. It is bound by Pakistan to the northwest, China, Bhutan and Nepal to the north, Myanmar
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and Bangladesh to the east, the Bay of Bengal to the southeast and the Arabian Sea to the
southwest. It is the second largest country in Asia and the territory also includes the Andaman,
Nicobar and the Lakshadweep Islands. The mainland of India can be divided into four
topographical regions. (1.) The northern mountains or Himalayan region which comprises three
parallel ranges mixed with large plateaux and valleys. (2.) The Indo-Gangetic Plain which is
formed by the basins of the Ganges, Indus and Brahmaputra Rivers. (3.) The desert region which
is divided into the Great and Little Deserts. (4.) The southern region which includes a narrow
coastal plain along the Arabian Sea and a broader one along the Bay of Bengal. The southern
region is separated from the Indo-Gangetic Plain by a mass of mountain ranges and plateaux on
the Indian or Deccan Peninsula, which are flanked by the Western and Eastern Ghats. The rivers
of India are generally divided into the Himalayan and peninsula rivers, and the principal rivers
include the Ganges with its tributaries, the Jumna, Yamuna, Ghaghra, Gandak, Kosi, Chambi,
Betwa, Son, Mahanadi, Godavari, Krishna, Cauvery, Narbada and Tapti. Major Cities (pop. est.);
Mumbai (Bombay) 9,925,900, Delhi 7,206,700, Calcutta 4,399,800, Madras 3,841,400,
Bangalore 3,302,300, Hyderabad 3,145,900, Ahmadabad 2,954,500, Kanpur 1,879,400, Nagpur
1,624,800, Lucknow 1,619,100, Pune 1,566,700, New Delhi 301,300 (1991). Land Use; forested
23%, pastures 4%, agricultural-cultivated 57%, other 16% (1993).
1.7.2.7 CLIMATE: India has a tropical climate that is dominated by the Asiatic monsoons with
four fairly distinct seasons which are common to all six or seven climatic regions. (1.) A
relatively cool winter monsoon season. (2.) A hot and rainless transitional season. (3.) A rainy
monsoon season and (4.) a humid season. Tropical hurricanes and cyclones are common between
April to June and September to December. Average temperature ranges in New Delhi are from 7
to 21 degrees Celsius (45 to 70 degrees Fahrenheit) in January to 26 to 41 degrees Celsius (79 to
106 degrees Fahrenheit) in May.
1.7.2.8 PEOPLE: India's racial diversity is extremely complex, but generally can be divided
into the following ethnic groups. The Indo-Aryan who represent 72% of the population while the
Dravidian account for 25% and the Mongoloid with others account for 3%. There are also three
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alien ethnic groups which include the Parsis, Jews and the Anglo-Indians of mixed European and
Indian descent.
1.7.2.9 DEMOGRAPHIC/VITAL STATISTICS: Density; 275 persons per sq km (712

persons per sq mi) (1991). Urban-Rural; 25.7% urban, 74.3% rural (1991). Sex Distribution;
51.9% male, 48.1% female (1991). Life Expectancy at Birth; 58.1 years male, 59.1 years female
(1986-90). Age Breakdown; 37% under 15, 27% 15 to 29, 18% 30 to 44, 11% 45 to 59, 6% 60 to
74, 1% 75 and over (1990). Birth Rate; 32.5 per 1,000 (1991). Death Rate; 11.4 per 1,000
(1991). Increase Rate; 21.1 per 1,000 (1991). Infant Mortality Rate; 80.0 per 1,000 live births
(1990).
1.7.2.10 RELIGIONS: Around 83% of the population are Hindu, 11.4% are Muslim, 3% are
Christian, 2% are Sikh while just under 1% are Buddhist and .5% are Jain.
1.7.2.11 LANGUAGES: The official languages are Hindi and English, with Hindi including its
associated languages and dialects accounting for 84% of the population while English is used for
national, political and commerce purposes. Over 1,600 languages and dialects are spoken
throughout India with over 15 constitutionally recognized.
1.7.2.12 EDUCATION: Aged 25 or over and having attained: no formal schooling 65.8%,
incomplete primary 7.1%, primary 10.9%, incomplete secondary 6.2%, secondary 7.1%, higher
2.9% (1981). Literacy; literate population aged 15 or over 261,200,000 or 48.2% (1990).
1.7.2.13 MODERN HISTORY - WWII TO 1993: On Aug. 15, 1947 India gained
independence from Britain and the next day Pakistan was created while Jawaharlal Nehru
became India's first Prime Minister. From 1948 to 1949 India and Pakistan fought over Kashmir
which ended when the UN divided the Kashmir between the two countries. In 1948 Mohandas
Gandhi who led India to independence was assassinated. In 1950 India adopted a new
constitution which made it a republic. In 1962 a border dispute erupted with China, in which
China invaded the northeastern border section of India. In May 1964 Prime Minister Nehru died
after being at the forefront of Indian politics since its independence. In 1965 a second war broke
out between India and Pakistan over Kashmir which resulted in Soviet mediation and a peace
agreement in Jan. 1966. In Mar. 1971 Indira Gandhi, became India's first woman Prime Minister.
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In Dec. 1971 India assisted East Pakistan in a war against West Pakistan which resulted in East
Pakistan becoming the independent nation of Bangladesh. In 1977 Prime Minister Indira Gandhi
and her party were defeated in parliamentary elections, however, in 1980 she won the elections
and became Prime Minister again. In 1983 serious unrest developed with the Sikhs wanting more
regional autonomy for Punjab state and in 1984 the Indian Army launched a massive offensive
and as many as 1,000 people were killed in the two day battle. On Oct. 31, 1984 two Sikh
bodyguards assassinated Indira Gandhi and Rajiv Gandhi her son, succeeded her as Prime
Minister in December after parliamentary elections. In July 1985 Rajiv Gandhi signed a peace
accord with the Sikh leader, however, the violence continued and in May 1987 the Punjab state
government was dismissed and the state was placed under central control. Additionally, since
1983 there has been a Sri Lankan Tamil separatist insurgence and in 1987 under an agreement
with the Sri Lankan government India occupied the northern regions of the island. On Mar. 6,
1991 Prime Minister Chandra Shekar resigned and Pres. Ramaswamy Venkataraman dissolved
the lower house of Parliament on Mar. 13, 1991. The elections were set for May 20, 23 and 26,
1991, and were a three way contest between the Indian National Congress (I), the Bharatiya
Janata Party (BJP) and a National Front and leftist parties combination. On May 21, 1991 Rajiv
Gandhi was assassinated by the Tamil "Tiger" guerrilla group in a human bomb attack that also
killed 14 others while he was preparing to give a campaign address in Sriperumbudur. Elections
due for May 23 and 26 were postponed until June 12 and 15, and resulted in the Congress (I)
forming another government and Pamulaparti Venkata Narasihma Rao being sworn in as Prime
Minister on June 21, 1991. On Sept. 24, 1991 the government announced its intention to adopt
the Mandal Commission's recommendation that 27% of public jobs be reserved for "socially and
educationally backward classes". On Oct. 20, 1991 a massive earthquake in the Himalayan
region of Uttar Pradesh killed some 1,600 people while during 1991 there was an insurgence in
violence and assassinations from militant groups in Punjab, Jammu and Kashmir, and Assam
that climaxed on Dec. 26, 1991 with Sikh separatists killing 49 Hindu passengers and wounding
a further 20 on a train in Punjab. In Jan. 1992 some 91 Bombay slum dwellers lost their lives
after drinking impurely mixed alcohol during New Years celebrations while in May 1992 some
210 also lost their lives in Orissa through similar circumstances. In Feb. 1992 some 47 people
died as a result of a stampede during the ritual bathing in Kumbakonam. In April 1992 a massive
By Namit Kumar
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stock swindle known as the scam where a group of bankers and brokers collaborated to
manipulate stock market operations resulted in the arrest of prominent brokers and the
executives of several foreign and Indian banks and institutions. On July 25, 1992 Pres. R.
Venkataraman was succeeded by Shankar Dayal Sharma after presidential elections. During
1992 separatist militant activities continued in the regions of Punjab, Jammu and Kashmir and
Telingana region. On Dec. 6, 1992 Hindu-Muslim riots erupted throughout the country after the
demolition of the Muslim Babri Mosque in Ayodhya by Hindu militants and thousands of
supporters. The Hindus had claimed the site was the birthplace of Lord Rama and that they were
going to build their own temple. On the same day and in response the government dismissed the
BJP-run state government of Uttar Pradesh and imposed direct Presidential rule on the state
while on Dec. 7, 1992 Hindu and Muslim fundamentalist parties were outlawed. On Dec. 8,
1992 the BJP leaders were arrested and on Dec. 15, 1992 other BJP-run state governments were
dismissed. By Dec. 12, 1992 the death toll from the religious clashes had climbed to 1,150. On
Jan. 6, 1993 Hindu-Muslim riots broke out in Bombay claiming some 560 lives in the first week.
On Jan. 7, 1993 Pres. Sharma issued a ordinance, that was later ratified by the Parliament, to
acquire 67.7 acres (27.4 hectares) around the temple site and the intention to construct two
temples on the site, one for the Muslims and the other for the Hindus. On Jan. 10, 1993 the BJP
leaders arrested in Dec. 1992 were released. In March and April, 1993 there were politically
motivated bombings in Calcutta and Bombay with 60 and 33 people respectively losing their
lives. During 1993 the government established a human rights commission to investigate claims
of violations and abuse at the hands of police and security forces while clashes between the
government forces and the various militant separatists continued throughout the year. Also in
1993 the government appointed a joint parliamentary committee to investigate the 1992 stock
market scandal, which had allegedly lost Rs 40,242,000,000 and the country also experienced its
worst earthquake in 50 years in the Maharashtra state on Sept. 20, 1993 with some 10,000 people
officially losing their lives, although unofficial reports claimed the death toll to be as high as
35,000 with some 140,000 rendered homeless.
1.7.2.14 CURRENCY: The official currency is the Rupee (Re) divided into 100 Paisa.
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1.7.2.15 ECONOMY: Gross National Product; USD $262,810,000,000 (1993). Public Debt;
USD $80,985,000,000 (1993). Imports; Re 728,060,000,000 (1994). Exports; Re
695,470,000,000 (1994). Tourism Receipts; USD $1,487,000,000 (1993). Balance of Trade; Re
38,134,000,000 (1994). Economically Active Population; 314,131,370 or 37.5% of total
population (1991). Unemployed; 13.1% (1990).
1.7.2.16 MAIN TRADING PARTNERS: Its main trading partners are the USA, the UK, the
former USSR, Japan, Iran and Iraq.
1.7.2.17 MAIN PRIMARY PRODUCTS: Barley, Bauxite, Chromium, Coal, Cotton, Copper,
Fruit, Gemstones, Ground Nuts, Iron Ore, Jute, Limestone, Manganese, Mica, Millet, Oil and
Gas, Potatoes, Pulses, Rice, Sorghum, Sugar Cane, Tea, Vegetables, Wheat.
1.7.2.18 MAJOR INDUSTRIES: Agriculture, Beverages, Cement, Chemicals, Coke,

Fertilizers, Food Processing, Iron and Steel, Machinery, Oil Refining, Software Development,
Textiles, Transport Equipment.
1.7.2.19 MAIN EXPORTS: Fish, Food, Gemstones, Handicrafts, Iron Ore, Leather, Machinery,
Software, Tea, Textiles.
1.7.2.20 TRANSPORT: Railroads; route length 61,975 km (38,509 mi) (1990), passenger-km
284,800,000,000 (176,966,000,000 passenger-mi) (1990), cargo ton-km 233,900,000,000
(160,198,000,000 short ton-mi) (1990). Roads; length 2,000,000 km (1,242,742 mi) (1989).
Vehicles; cars 2,284,000 (1989), trucks and buses 1,433,000 (1989). Merchant Marine; vessels
855 (1990), deadweight tonnage 10,497,191 (1990). Air Transport; passenger-km
16,518,000,000 (10,264,000,000 passenger-mi) (1990), cargo ton-km 662,832,000 (453,974,000
short ton-mi) (1990).
1.7.2.21 COMMUNICATIONS: Daily Newspapers; total of 3,805 with a total circulation of

18,800,000 (1993). Radio; receivers 65,000,000 (1994). Television; receivers 20,000,000 (1994).
Telephones; units 8,037,400 (1993).
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1.7.2.22 MILITARY: 1,145,000 (1992) total active duty personnel with 85.6% army, 4.8%
navy and 9.6% air force while military expenditure accounts for 3.3% (1993) of the Gross
National Product (GNP).
1.8 TRADE RELATION WITH US:
The United States is India's largest trading partner. In 2007, the United States exported
$17.24 billion worth goods to India and imported $24.02 billion worth of Indian goods. Major
items exported by India to the U.S. include Information Technology Services, textiles,
machinery, ITeS, gems and diamonds, chemicals, iron and steel products, coffee, tea, and other
edible food products. Major American items imported by India include aircraft, fertilizers,
computer hardware, scrap metal and medical equipment. The United States is also India's largest
investment partner, with American direct investment of $9 billion accounting for 9% of total
foreign investment into India. Americans have made notable foreign investment in India's power
generation, telecommunications, ports, roads, petroleum exploration/processing, and mining
industries.
Below are the percentages of traded items India to US increased by 21.12% to $6.94
billion.
 Diamonds & precious stones (25%)

 Textiles (29.01%)
 Iron & Steel (5.81%)
 Organic chemicals (4.3%)
 Machinery (4.6%)
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 Electrical Machinery (4.28%)
By Namit Kumar
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2.EXPORT PERFORMANCE
2.1 MAJOR IMPORTERS OF ORGANIC CHEMICALS:
Major importers of organic chemicals from India are USA, China, Indonesia, Germany,
Pakistan, Singapore, Spain, Netherland etc.
HS CODES - CHEMICAL PRODUCTS
Code 28 - Inorganic chemicals; organic or inorganic compounds of precious metals, of

rare-earth metals, of radioactive elements or of isotopes
Code 29 - Organic chemicals
Code 30 - Pharmaceutical products
Code 31 - Fertilizers Code
Code 32 - Tanning or dyeing extracts; tannins & derivatives; dyes, pigments & coloring
matter; paint & varnish; putty & other mastics; inks
Code 33 - Essential oils and resinoids; perfumery, cosmetic or toilet preparations
Code 34 - Soap; waxes; polish; candles; modelling pastes; dental preparations with basis of
plaster
Code 35 - Albuminoidal substances; modified starch; glues; enzymes
Code 36 - Explosives; pyrotechnic products; matches; pyrophoric alloys;certain

combustible preparations
Code 37 - Photographic or cinematographic goods
Code 38 - Miscellaneous chemical products
By Namit Kumar
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2.2 EXPORT OF INORGANIC CHEMICALS TO USA
S.No. \Year 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009
1. Values in US$ Million 18.06 22.70 30.99 38.16 53.68
2. %Growth 25.69 36.51 23.13 40.68

3. Total export of 424.09 639.11 774.87 801.29 824.21
commodity
4. %Growth 50.70 21.24 3.41 2.86

5. %Share of country (1 of 4.26 3.55 4.00 4.76 6.51
3)
6. Total export to country 11,490.03 13,765.75 17,353.06 18,851.42 20,722.17
7. %Growth 19.81 26.06 8.63 9.92

8. %Share of commodity (1 0.16 0.16 0.18 0.20 0.26
of 6)
Exchange rate: (1US$ =

45.9516 44.9315 44.2735 45.2849 40.2410
Rs.)
By Namit Kumar
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2.3 EXPORT OF ORGANIC CHEMICALS TO USA
S.No. \Year 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009
1. Values in US$ Million 329.29 389.52 550.49 666.31 778.79
2. %Growth 18.29 41.32 21.04 16.88
3. Total export of 2,823.53 3,620.49 4,857.09 5,730.31 7,174.22

commodity
4. %Growth 28.23 34.16 17.98 25.20
5. %Share of country (1 of 11.66 10.76 11.33 11.63 10.86

3)
6. Total export to country 11,490.03 13,765.75 17,353.06 18,851.42 20,722.17
7. %Growth 19.81 26.06 8.63 9.92
8. %Share of commodity 2.87 2.83 3.17 3.53 3.76

(1 of 6)
Exchange rate: (1US$ =

45.9516 44.9315 44.2735 45.2849 40.2410
Rs.)
3 TREND ANALYSIS
By Namit Kumar
- 41 -
3.1 EXPORT OF INORGANIC CHEMICALS FROM INDIA

(Value in US $ mn.)
YEAR VALUE TREND VALUE
2003-04 424.09 500.23
2004-05 639.11 596.47
2005-06 774.87 692.71
2006-07 801.29 788.96
2007-08 824.21 885.20
2008-09 - 981.44
2009-10 - 1077.68
2010-11 - 1173.92
2011-12 - 1270.17
2012-13 - 1366.41
By Namit Kumar
- 42 -
1600
1400
1200
Value in US $ mn.
1000
800
600
400 Inorganic
200 TREND
20
20
20
20
20
20
20
20
20
20
04
06
07
08
09
10
11
12
03
05
-08
-10
-04
-05
-06
-07
-09
-11
-12
-13
Ye ar
By Namit Kumar
- 43 -
TREND ANALYSIS
3.2 EXPORT OF INORGANIC CHEMICALS FROM INDIA TO USA
(Value in US $ mn.)
2003-04 18.06 15.38
2004-05 22.70 24.05
2005-06 30.99 32.72
2006-07 38.16 41.39
2007-08 53.68 50.06
2008-09 - 58.73
2009-10 - 67.40
2010-11 - 76.07
2011-12 - 84.74
2012-13 - 93.41
By Namit Kumar
- 44 -
100
80
Value in US $ mn.
60
40
20
Inorganic USA
0 TREND
20
20
20
20
20
20
20
20
20
20
03
05
06
07
08
09
04
10
11
12
-0
-0
-0
-0
-0
-0
-1
-1
-1
-1
6
0
4
Year
By Namit Kumar
- 45 -
TREND ANALYSIS
3.3 EXPORT OF ORGANIC CHEMICALS FROM INDIA
(Value in US $ mn.)
TREND
YEAR VALUE
VALUE
2003-04 2823.53 2678.89
2004-05 3620.49 3760.01
2005-06 4857.09 4841.13
2006-07 5730.31 5922.25
2007-08 7174.22 7003.37
2008-09 - 8084.49
2009-10 - 9165.61
2010-11 - 10246.73
2011-12 - 11327.85
2012-13 - 12408.97
By Namit Kumar
- 46 -
14000
12000
10000
Value in US $ mn.
8000
6000
4000
Organic
2000 TREND
20
20
20
20
20
20
20
20
20
20
03
04
05
06
07
08
09
10
11
12
-0
-0
-0
-0
-0
-0
-1
-1
-1
-1
4
Year
By Namit Kumar
- 47 -
TREND ANALYSIS
3.4 EXPORT OF ORGANIC CHEMICALS FROM INDIA TO USA
(Value in US $ mn.)
2003-04 329.29 307.72
2004-05 389.52 425.30
2005-06 550.49 542.88
2006-07 666.31 660.46
2007-08 778.79 778.04
2008-09 - 895.62
2009-10 - 1013.20
2010-11 - 1130.77
2011-12 - 1248.35
2012-13 - 1365.93
By Namit Kumar
- 48 -
1600
1400
1200
Value in US $ mn.
1000
800
600
400 Organic USA
200 TREND
20
20
20
20
20
20
20
20
20
20
04
05
08
09
12
03
06
07
10
11
-0
-0
-0
-0
-0
-0
-1
-1
-1
-1
4
Year
By Namit Kumar
- 49 -
4. ORGANIC CHEMICAL SUPPLIERS
1. INDO AMERICAN CHEMICALS
Business Profile
Suppliers and exporters of industrial chemicals including specialty chemicals, organic chemicals,
oleo chemicals, process chemicals, industrial flocculants, specialty polymers, polyacrylamide
flocculants and powder metallurgy lubricants.
Contact Details
Street Address: M-58, IInd Floor, Greater Kailash II (Market)
City: New Delhi State: Delhi PIN: 110 048 Country: India
Phone: +(91)-(11)-29216344 Fax: +(91)-(11)-29216352
Website: http://www.indiamart.com/indo-american/speciality-chemicals.html
2. ABHISHEK IMPEX, MUMBAI
Business Profile
Engaged in manufacturing of organic chemicals, oilfield chemicals, bactericides, sodium
monochloroacetate, monochloroacetic acid, turkey red oil, pigment beta blue 15:3 and chemicals
for polyester & nylon yarn.
Contact Details
Street Address: 202/A2-1, Veer Hanuman Nagar, LM Road, Dahisar(W)
City: Mumbai State: Maharashtra PIN: 400 068 Country: India
Phone: +(91)-(22)-28933984 Fax: +(91)-(22)-28912615
Website: http://www.abhishek-impex.com/
By Namit Kumar
- 50 -
3. GAYATRI MINERALS AND CHEMICALS
Business Profile
Manufacturer and exporter of organic chemicals, organic solvents, organic intermediates like
benzyl acetate ffc, benzaldehyde, ortho chloro benzoic acid, calcium chloride, benzoyl peroxide
and dibenzyl ether.
Contact Details
Street Address: 34-A, Shastri Nagar, Nizampura
City: Baroda State: Gujarat PIN: 390 002 Country: India
Phone: +(91)-(265)-2781284/2780506/2782593 Fax: +(91)-(265)-2780228
Website: http://www.gayatrionline.com/
4. MODY CHEMICAL INDUSTRIES
Business Profile
Manufacture and export organic chemicals, inorganic chemicals, catalyst, hydantion, alphatic
bromide, dibromo alkane, bromate, bromide salts, bromo chloro alkanes, organics bromo
compunds and inorganics bromo compounds.
Contact Details
Street Address: 412, Hill View Estate, Siddhapura Compound, Amrut Nagar Road, Off L.B.S
Marg, Ghatkopar (W)
City: Mumbai State: Maharashtra PIN: 400 086 Country: India
Phone: +(91)-(22)-25004271/25006111/25006112 Fax: +(91)-(22)-25000546
Website: http://www.modychem.com/
By Namit Kumar
- 51 -
5. MAJOR FACTORS AFFECTING THE EXPORT
• India’s $ 1 trillion economy is the fourth largest and among the fastest growing
worldwide.
• Its population is more than 1 billion.
• Its Industry is growing 10% per year.
• The middle class accounts for one-third of the total population. By 2025, India will have
24 million rich people, equivalent to the present population of Australia, and 400 million
urban middle class, more than the present population of the U.S.
By Namit Kumar
- 52 -
RATIONALE
Following are the reason to perform research on this topic, they are as follow:
• Demand of the chemical is very high in international market
• To find out performance of India in international market with reference of chemical
• Chemicals are useful for many purposes.
• There are different chemicals which is exported by India.
By Namit Kumar
- 53 -
OBJECTIVES
• To study various market for chemical
• To analyses the performance of India in global market.
• To find new market for India.
By Namit Kumar
- 54 -
METHODOLOGY
The chemical sector is an important part of the Indian Economy,. But help for trade so as to
make the country’s export chemical more competitive is recent.
5.1 type of study

• Research of the exports of chemical from India to USA.
5.2 countries involved

• India and USA
5.3 data collection and sources

• I have used the secondary data for the preparation of this project. Sources of
secondary data being the books. Websites and search engines, magazines, journals
and news paper articles.
By Namit Kumar
- 55 -
LIMITATIONS
• The time period provided for the research was not sufficient to undergo an analytical research
work.
• Direct face to face interaction for collecting the primary data was not possible.
• The secondary data has been collected on the basis of various trade portals, thus the
authentication of the data is questionable.
By Namit Kumar
- 56 -
FINDINGS
• 5 years (2003-04 to 2007-08) figure of Export of Inorganic chemicals from India has
been taken for trend analysis. It’s clear that export is continuously increasing year by
year. That is a good sign for Indian chemical industry. In 2003-04 it was 424.09 US $ mn
and it reached upto 824.21 US $ mn in 2007-08 i.e. 94% growth in last five years. From
trend analysis its clear that export of inorganic chemical will increase in next five years
and may reach up to 1366.41 US $ mn. in 2012-13.
• India doesn’t export inorganic chemicals in large quantity to USA but its increasing year
by year. In 2007-08 the export was 53.68 US $ mn which was around 200% of the export
of 2003-04. Trend analysis also showing increasing trend.
• In 2003-04 India’s export of organic chemicals was 2823.53 US$ mn and in 2007-08 it
was 7174.22 US $ mn. i.e. 154% growth in last 5 years. Trend analysis also showing
increasing trend. In 2012-13 the export of organic chemicals from India may reach upto
12408.97 US $ mn.
• India exports organic chemicals to USA in good quantity. In 2007-08 the export was
778.79 US $ mn which was around 135% of the export of 2003-04 (329.29 US $mn.).
Trend analysis also showing increasing trend. In 2012-13 the export of organic chemicals
from India to USA may reach upto 1365.93 US $ mn.
By Namit Kumar
- 57 -
SUGGESTIONS
• The role of the Indian government should change from Industry “regulator” to
“facilitator”.
• The government must help to create several petroleum, chemical and petrochemical
investment regions as well as special economic zones, nationwide to stimulate growth.
• Custom duties must be reduced more.
• The severe power shortages that currently plague India must be remedied.
• India had in the past little presence on the world scene, but Reliance, Hikal, the Birla
Grop, United Phosphorus and the Tata Group have transformed that. But still there is
scope and more companies should come forward in chemical industry.
• Reliance’s acquisitions abroad have been smaller. Since it is a big group, so it must
increase its acquisitions.
By Namit Kumar
- 58 -
CONCLUSION
Chemical industry occupies an important place in the country’s economy. During 2005-
06, it contributed about 3% of GDP and 17.6% of the manufacturing sector. However, India
continued to be a net importer in 2005-06, with imports of US$7.92 billion and exports at
US$5.95 billion. Indian chemicals industry during 2005-06 was US$30.59 billion, a growth of
10.23% over the previous year and a CAGR of 8.68% during the last 3 years.
The Indian chemical industry has sales of $50 billion / year, excluding, refining and
fertilizers. With refining and fertilizers its sales are $150 billion/year. In 2006-07 the chemical
industry grew 8.9%.
Potential investors are changing their views on India. Some companies are switching
their attention from China to India. India has become a preferred choice for sourcing dyes. India
is a global hub for pharma manufacturing.
India has one global leader in Reliance, a strong pharma presence, and a ‘long tail of
small and medium sized companies’. Emerging market companies , including Indian firms, are
starting to overtake established chemical groups in terms of market capitalization.
Liberalization of the Indian economy and the slashing of import duties have forced
Indian companies to transform their business models to become more competitive, have
economies of scale and look beyond India’s border.
By Namit Kumar
- 59 -
REFERENCES
 http://www.in.kpmg.com/TL_Files/Pictures/KPMG_Chemtech_Report.pdf
 http://www.pharmabiz.com/article/detnews.asp?articleid=49270
 http://en.cbichina.com/Common/1986865,0,0,0,1.htm
 http://www.nandinichemical.com/gatewaytoindianchemind.html
 http://kalex.in/Report/25%20-%2011%20Indian%20Chemical%20Industry.pdf
 http://en.wikipedia.org/wiki/India_%E2%80%93_United_States_relations
 http://www.financialexpress.com/news/chemicals-export-may-jump-20-this-fiscal/56830/
 http://www.indianchemicalportal.com/chemical-industry-overview
 http://www.reportlinker.com/p047658/Indian-Chemical-Industry.html
By Namit Kumar
- 60 -

Indian Chemical Industry MRP

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Export of chemical from India to U.S.

INDIAN CHEMICAL INDUSTRY

1.1.1 Companies in 21st century

International Institute of Foreign Trade and research, Indore

2007 Chemical Sales,

BASF SE, Ludwigshafen, Germany $65.3 1

Dow Chemical, Midland, Michigan, USA $53.5 2

INEOS, Lyndhurst, UK $43.6 3

LyondellBasell, Houston, Texas, USA $42.8 4

Formosa Plastics, Taiwan $31.9 5

DuPont, Wilmington, Delaware, USA $28.5 6

Saudi Basic Industries Corporation, Riyadh, Saudi

Bayer, AG, Leverkusen, Germany $24.2 8

Mitsubishi Chemical, Tokyo, Japan $22.2 9

Akzo Nobel/Imperial Chemical Industries(ICI),

Air Liquide, Paris, France $16.3 11

Sumitomo Chemical, Tokyo, Japan $15.2 12

Evonik Industries, AG, Essen, Germany $15.0 13

Mitsui Chemicals, Tokyo, Japan $14.3 14

Asahi Kasei, Tokyo, Japan $13.8 15

Toray Industries, Tokyo, Japan $13.1 16

Chevron Phillips, The Woodlands, Texas, USA $12.5 17

DSM NV, Heerlen, Netherlands $12.1 18

PPG Industries, Pittsburgh, Pennsylvania, USA $11.2 19

Shin-Etsu Chemical Co., Ltd., Tokyo, Japan $11.1 20

International Institute of Foreign Trade and research, Indore

International Institute of Foreign Trade and research, Indore

The Chemical Industry in India constitutes of numerous chemical exporters, chemicals

• Total US$30.59 Billion during 2005-2006 as per March 2007 report.

1.1.3 SECTOR HIGHLIGHTS

International Institute of Foreign Trade and research, Indore

Polymers and plastics, especially polyethylene, polypropylene, polyvinyl chloride, polyethylene

1.2.1 Product Category Breakdown

International Institute of Foreign Trade and research, Indore

Specialty Chemicals are sometimes referred to as "fine chemicals"

International Institute of Foreign Trade and research, Indore

manufacturers of inorganic- and organic-industrial chemicals, ceramic products, petrochemicals,

Product Type Examples

organic industrial acrylonitrile, phenol, ethylene oxide, urea

ceramic products silica brick, frit

petrochemicals ethylene, propylene, benzene, styrene

agrochemicals fertilizers, insecticides, herbicides

polymers polyethylene, Bakelite, polyester

elastomers polyisoprene, neoprene, polyurethane

oleochemicals lard, soybean oil, stearic acid

explosives nitroglycerin, ammonium nitrate, nitrocellulose

fragrances and flavors benzyl benzoate, coumarin, vanillin

International Institute of Foreign Trade and research, Indore

1.5 TYPES OF CHEMICALS

1.5.1 Organic And Inorganic Chemicals

International Institute of Foreign Trade and research, Indore

1.5.1.1 Inorganic Chemicals

• US$ 2.5 Billion industry.

• Covers basic products like Caustic, Chlorine, Sulphuric Acid etc.

• Competition from imports are on the rise.

1.5.1.2 Organic Chemicals

• 1 Billion Dollar industry.

• Covers a wide range of chemicals.

• Units concentrated mostly in the Western India.

1.5.2 DRUGS AND PHARMACEUTICALS:

1.5.3 PESTICIDES AND AGROCHEMICALS:

In agrochemical, we manufacture significant quantities of synthetic pyrethroids, such as