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GLOBAL & INDIAN SCENARIO

The size of the global chemical industry is estimated at The chemical industry is a key contributor to the
approximately USD 2.4 trillion in 2002. The industry is world economy. It is a knowledge-based industry
currently under-performing and is in the trough of the with significant investments in R&D. The industry
business cycle. Some of the emerging trends of the global supplies to virtually all sectors of the economy and
chemical industry that can be leveraged for growth are: produces more than 80,000 products.

increasing globalization as growth in mature markets drives


leading players to explore new developing markets; In terms of consumption, the chemical industry is its

consolidation to leverage economies of scale in the Basic own largest customer and accounts for
and Knowledge segments; approximately 33 per cent of the consumption. In

increasing focus on core businesses, resulting in most cases, Basic chemicals undergo several
diversified chemical and multi-product companies processing stages to be converted into downstream
divesting businesses or exiting non-core product chemicals. These in turn are used for industrial
lines; applications, agriculture, or directly for consumer

cost optimization assuming critical importance in the face markets.


of slow growth coupled with a pressure on prices due to
competition; Industrial and agricultural uses of chemicals include

increasing investments in R&D (especially in the Specialty auxiliary materials such as adhesives, unprocessed
and Knowledge segments) to gain competitive advantage; plastics, dyes and fertilisers, while uses within the

increasing use of IT to transact business intra-company consumer sector include pharmaceuticals,


and across the extended supply chain. cosmetics, household products, paints, etc.

The chemical industry is a key contributor to the world economy. It is a knowledge-based industry with significant investments
in R&D. The industry supplies to virtually all sectors of the economy and produces more than 80,000 products.

INDIAN SCENARIO

Size is estimated at around US$ 35 billion approx., which is equivalent to about 3% of


India's GDP
The total investment in Indian Chemical Sector is approx. US$ 60 billion and total
employment generated is about 1 million.
The Indian Chemical sector accounts for 13-14% of total exports and 8-9% of total imports
of the country. In terms of volume, it is 12th largest in the world and 3rd largest inAsia.
Per capita consumption of products of chemical industry in India is about 1/10th of the
world average
Over the last decade, the Indian Chemical industry has evolved from being a basic chemical
producer to becoming an innovative industry and grows at a rate of 10% per annum
Fine and speciality chemicals, drugs and pharmaceuticals, dyes and pigments,
agrochemicals and fertilizers, pesticides, plastics and petrochemicals etc.
With the current levels of performance, the Indian chemical industry ranks twelfth in the
world production of chemicals and enjoys an impressive growth rate:
The chemical industry has achieved a growth rate of 8.6 per cent over the last few years,
making it one of the fastest growing sectors in India.
The industry's growth rate has been twice the Asian growth rate over the last five years.
Thus while growth is higher than global levels, asset creation has been at its lowest. The
industry needs to look for a new direction in order to improve its competitiveness in the
global context. Discussions with industry leaders showcase the new aspirations that players

EXHIBITS (SOURCE :- KPMG ANALYSIS)


GLOBAL & INDIAN SCENARIO
Chemical industry geographic segmentation INDIAN MANUFACTURING
STATES
Others 17%

Global chemical industry classification

GLOBAL TREND