In the COP26 summit at Glasgow in 2021, Prime Minister Narendra Modi committed India to achieve net zero emissions by 2070. India’s commitment is a critical foundation in the global pathway to achieving the ambitious 1.5˚C global warming target. The chemical sector will play a foundational role in achieving the global as well as Indian Net Zero pathway.
The chemical industry is currently significantly behind other sectors in its public commitments to science-based targets to transition to net-zero emissions as well as in the clarity of its pathways to achieving Net Zero. It is reasonable to anticipate that the global Chemical sector might be the last major sector to transition to Net Zero emissions.
The carbon atom is ubiquitous across the chemical industry – as feedstock, fuel, product, and in end-of-life emissions, making it difficult for any simple set of pathways to holistically cover the entire sector. However, the complexity of the sector also presents the Indian chemical industry with its greatest opportunity. The 2020s mark the beginning of an Indian decade in the chemical sector, especially the speciality chemical sector. India is today on the cusp of a multi-decadal opportunity to emerge as a global hub for chemical manufacturing.
The transition to a net zero chemical sector can help India save lives from Climate disasters, catalyze entire new industries, create tens of thousands of jobs, drive billions of dollars of economic value and provide a significant heft to India’s role in the frontline of the global war on climate change. The time to act is now and this report deciphers the road ahead and offers insights that encourage decisive action.
Indian chemical industry is on a rapid growth trajectory in the global chemical landscape. The industry has been growing at a steady pace and is expected to grow at a CAGR of 6-7% till FY 2030, contributing nearly USD 383 billion to India’s GDP.
India’s chemical sector has overcome the COVID disruption and is on an accelerated long-term growth trajectory, enabled by four key drivers:
The Net Zero
Experts anticipate that as many as 30 Indian chemical companies could surpass the USD 1 billion revenue threshold in the following ten years, offering lucrative investment prospects in all areas, including petrochemicals, specialty chemicals, and agrochemicals.
Transitioning to Net Zero, along with the Indian government’s focus on improving ease of doing business and trade competitiveness, could help India overcome its three traditional barriers to success in the Chemical sector: access to feedstock, competitive power and logistics costs, and geoeconomic trade disadvantages. Together, these factors may enable India to become a global leader in fields like green methanol, green ammonia, and biobased chemicals.
To know more, read the full CII – Kearney report on “Mission Net-Zero: A Roadmap for the Indian Chemical Industry”.