The Coronavirus 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. India’s dependency on China for chemicals across the value chain for broad categories ranges between 10 and 40%. 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.
We at Indian Chemical Council believe that 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. 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.