The
petrochemical industry has been one of the of the fastest growing industries in
the Indian economy; it provides the foundation for manufacturing industries
such as pharmaceuticals, construction, agriculture, packaging industry,
textiles, automotive, etc. The petrochemical industry in India is oligopolistic
with four main players dominating the market, namely Reliance Industries Ltd.
(RIL) along with Indian Petrochemical Ltd. (IPCL), Gas Authority of India Ltd
(GAIL), and Haldia Petrochemicals Ltd. (HPL).
The major
driver for the growth of petrochemical industry in India is its (India's)
ongoing economic development. With the Government announcing an infrastructure
development program of over INR 500 Billion, coupled with growth in key end-use
sectors like auto, personal / lifestyle products, and retail (packaging), a
boost is expected in the demand for petrochemical products in India. The
Government has set in place policies to promote investment in the petrochemical
sector, and several key domestic companies have unveiled ambitious expansion
plans for the next few years. Two major elements in this support are the
decision to allow 100 percent foreign direct investment projects in this
sector, and establishment of a series of special economic zones (SEZs) and a
number of petroleum, chemicals, and petrochemical investment regions (PCPIRs).
The future
of the Indian petrochemicals industry is bright with domestic demand driving
the market for products. With Government support slowly falling into place, the
future could see more investments from multinationals as well as domestic
companies.
