Amity International Business School

GPTAIE

CHEMEXCIL

Prepared by – Submitted to -

Rahul Goyal Ms. Alka Maurya

Mayank Gupta

Sidharth Ahuja

(Section F)

Batch – 2012-14

1

TABLE OF CONTENTS

S.no Content Page No.

1. Introduction 3

2 Overview of Global Industry 3

3 Overview of Indian Chemical Industry 4

4 Roles of Chemexcil 6

5 Initiatives taken by Chemexcil 7

6 Chemexcil’s Total Exports 9

7 Dyes & Dye Intermediates 11

8 Inorganic, Organic and Agro Chemicals 15

2

9 Cosmetics, Toiletries and Essential Oils 22

10 Castor Oil 26

11 Major Competitors in the global market 31

12 Provisions in Foreign Trade policy 34

13 Quality Standards 35

14 Major Challenges faced by Exporters 35

15 News Articles 37

16 References 38

CHEMEXCIL

Chemicals Export Promotion Council

Introduction

3

Basic Chemicals, Pharmaceuticals & Cosmetics Export Promotion Council, popularly known

as CHEMEXCIL was established in the year 1963 with its headquarters at Mumbai, with the

objective of making concerted efforts to promote exports of Basic Organic and Inorganic

Chemicals, Dyes, Pesticides, Soaps, Detergents, Cosmetics, Toiletries and other products like

Essential Oils, Castor Oil etc. Today Chemexcil has 4000 members comprising of Large

Scale Manufacturers, Small Scale Manufacturers & Merchant Exporters.

CHEMEXCIL has four separate panels viz.

1. Dyes & Dye Intermediates cals.

2. Basic Inorganic and Organic Chemicals including Agro Chemicals

3. Cosmetics, Toiletries, Essential Oils

4. Castor Oil and Derivatives of Castor Oil.

Overview of Global Chemical Industry

The world chemical industry is estimated to have reached Euro2353 billion (~ US$ 3127

billion) in 2010. The Asian region has emerged as the largest contributor to the global

chemical industry, accounting for nearly half the global sales (Euro 1147 billion) followed by

Europe (Euro 578 billion). Individually, China was the largest market for chemicals with

sales aggregating to Euro 575 billion, followed by USA (Euro 395 billion), Japan (Euro 153

billion), Germany (Euro 142 billion) and France (Euro 76 billion). India, with sales of Euro

56 billion was ranked the eighth largest market in 2010.

International trade in chemical products has witnessed a continuous rise with global exports

of chemicals recording an average annual increase of 6.2% during 2006-2010 to amount to

US$545 billion in 2010 as compared to US$ 451 billion in 2006. USA was the largest

exporter of chemicals with exports aggregating US$ 63.9 billion, followed by China (US$

49.3 billion), Germany (US$ 48.2 billion), Belgium (US$ 36.6 billion)_ and Japan (US$ 31.6

billion). However, in terms of dynamism in exports, it was led by the emerging market of

4

Asia Pacific, Middle East and Africa. While the average annual increase in exports from

Asia-Pacific region was 11.9% during the 2006-2010 period, it was as high as 21.9% each in

the case of Middle East and Africa. Consequently, the shares of these regions in world

exports of chemicals registered a consistent increase.

The World has witnessed that Asia is the fastest growing Region in the World. However,

Africa has superseded all the region of the World in terms of Average GDP growth rate. The

fastest growing country in the world is Angola and not China. The importance of the

Economies of Brazil – Russia – India – China & South Africa (BRICS) is growing in the

global economy, on a continuous basis.

Overview of Indian Chemical Industry

The Indian Chemical Industry has witnessed a robust growth in the past decade and has been

ranked 5th largest in Asia as per the Exim Bank studies. The industry is forecasted to reach

USD 200 billion mark by 2020. The industry accounts for about 10% of the output of the

Indian manufacturing sector, 13% of India’s total exports, and 9% of the country’s total

imports. In terms of segmentation, basic chemicals is the largest sector with total revenues

estimated at US$ 43 billion, equivalent to about two-third of the industry’s overall value in

2010. Within this, the contribution of small and medium enterprises (SME) in terms of

production of the chemical sector is estimated to be as high as 40% an indication of the

signification of SMEs, and as a corollary, the importance of this sector in employment

generation.

India has traditionally been a net importer of chemicals, a situation which can be reversed

with sustained efforts from the industry backed by an enabling policy mix from the

Government. The industry needs to look beyond the domestic shores in a more proactive

manner. In this context, an adoption of a two pronged approach that would entail market

5

diversification and expansion along with mapping of international demand for chemical

products so as to identify an ideal product market strategy mix needs to be undertaken.

Strong domestic demand, driven by increasing purchasing power parity in the country, is one

of the main pillars of the Indian Manufacturing sector, and India is expected to maintain a

healthy growth in the years to come. India’s geographic location provides easy access to the

world markets; and low cost advantage, availability of talent and skilled manpower make

India the destination of choice.

The Indian Government is rendering extensive support to give impetus to the Indian

Chemical Industry and has set up the Task Force to consider suggestions for National

Chemical Policy to ensure steady growth of the country’s chemical sector. India is 13th

largest country in terms of ethylene capacity and envisages enhancing the refining capacity to

300mm tpa in 2017 from the current 190mm tpa. India is emerging as Asia’s refining hub and

has become the net exporter of petrochemicals to countries like the Middle East, Korea, Japan

and Singapore.

Indian Government has set ambitious plans to set up Petroleum, Chemicals & Petrochemicals

Investment Regions (PCPIR) in Gujarat, Andhra Pradesh, West Bengal and Odisha to

accelerate the country’s industrial growth. The Indian Government has earmarked substantial

funds to achieve healthy growth of the country’s upstream and downstream sectors of the

chemical industry. During the 11th Five-Year Plan, the Indian government reserved INR

0.626 trillion for refining and marketing sectors and increased that to INR 1.54 trillion during

the 12th Five-Year Plan. Chemicals sector has attracted a cumulative FDI of USD 192

million in 2009-10. Inorganic Chemical Industry is growing at approximately 9% p.a. Dyes &

Dye Intermediates market is expected to reach 1200 kt by FY-15

6

Agrochemicals Industry is largely exports-driven with over 60% of exports to U.S.A., U.K. ,

Russia, EU, South Africa, Bangladesh, Malaysia. Aromatics & Olefins markets to grow at

15% & 10% p.a. respectively over the next 4-5 years.

Paints and Coatings Industry is projected to grow at the rate of 11-14% in the next five years.

Domestic Specialty Chemical Industry is expected to grow at 15%, almost double the growth

of global industry; exports to touch USD 13 billion in 2013.

On the above background in order to propagate “Brand India Image” CHEMEXCIL had

organized following events under Market Development Assistance (MDA) and Market

Access Initiative (MAI) given by Ministry of Commerce & Industry, Govt. of India.

Roles of Chemexcil

1. Issuance of RCMC.

2. Assisting members to get their MDA/MAI claims refunded from Govt. of India.

3. Dissemination of trade enquiries received from abroad.

4. Issuance of Certificate of Origin.

5. Maintenance of Chemical Library & help overseas importers/ Exporters - sourcing their

products.

6. Organizing Indian Pavilion in important International Chemical shows in order to create

Brand India Image.

7. Holding of Sector Specific International Conferences/ B2B Meets in India/ Abroad.

8. Holding of Sector Specific Indian Chemical Shows in Focus Area – to explore new markets

and in General areas to strengthen the existing markets.

7

9. Organize Reverse Buyer-Seller in India.

10. Help exporters in their needs for technology up gradation from inception of the product till it

is put in the Warehouse/ Showcase of Departmental stores under MAI. (For e.g. – Export of

Menthol to USA / Canada.)

11. Interface with Govt. for policy concern/ suggestions so that export is done smoothly.

12. Help exporters in compliance with regulatory affairs such as Reach, CLP etc.

Initiatives Taken up by Chemexcil in the Last Financial year

EVENTS UNDER MDA

1. Famericas, 2011 Lima, Peru - 19-21 May, 2011

2. Beautyworld, Middle East Dubai - 24-26 May, 2011

3. International Crop Science & Exhibition, Moscow, Russia & BSM Kazakhstan. - 4-7

July, 2011

4. 9th Dye + Chemicals 2011 International Exh, Dhaka, Bangladesh. - 20-23 July, 2011

5. Indian Chemical Exhibition, Bogota, Colombia - 11-12 August, 2011

6. BSM - Brazil & Argentina - 14-20 August, 2011

7. 4th Indexpo Muscat , Oman - 20-22 September, 2011

8. 10th Reverse Buyer Seller Meet, Gandhinagar, Gujarat - 13-15 October, 2011

9. Chemexpo - Thai 2011, Thailand - 5-7 January, 2012

10. Indian Chemical Exhibition, Mauritius - 23-24 February, 2012

11. BSM- Kenya & Tanzania - 27 & 29 February, 2012

12. Indian Chemicals Exhibition Malaysia 2012 - 13-14 March, 2012

13. BSM Australia - 15-16 March, 2012

8

EVENTS UNDER MAI

1. 11th China Interdye – 2011, China - 26-28 April, 2011

2. Chemspec USA 2011, Philadelphia, USA - 3-5 May 2011

3. Chemspec Europe 2011, Switzerland - 15-16 June, 11

4. FCI Trade 2011, Argentina - 17th Aug, 2011

5. 11th RBSM (OTAI), Mumbai 11-13 Dec, 2011

6. 13th CAC China – 2012, China. 6-8 March, 2012

Other Events by Chemexcil

1. RBSM coinciding with India–Chem – 4th – 6th October, 2012

2. Informex 2012 - 14th -15th September, 2012

3. BSM in Ecuador – 5th September, 2012

4. 5th Indian Trade Fare 2012 – 4th -6th September, 2012

5. BSM in Panama – 3th September, 2012

6. Indian Chemical Exhibition – 30th-31st August, 2012

7. RBSM at Goa – 27th-28th November, 2012

8. Indian Chemical Exhibition – 13th – 14th November, 2012

9. In-Cosmetics Asia – 6th - 8th November, 2012

10. IFEAT – 4th – 8th November, 2012

11. BSM – 1st November, 2012

12. Kichem 2012 – 31st October – 3rd November, 2012

13. Turchem Inerdye Exhibition – 11th-14th October, 2012

14. India Pavilion Turchem 2012 – 11th-14th October, 2012

15. India Chem 2012 – 4th-6th October, 2012

9

10

CHEMEXCIL’S EXPORT – PANELWISE

(Rs. in crore)

Chapter/Panel 2009-10 2010-11 2011-12(April/March) (April/March) (April/March)

% Increase over 2010-11

35.3

40.1

32.6

53.2

38.5

(32) Dyes & (29) Dye Intermediates

(28) Inorganic, (29) Organic &(38) Agro chemicals

(33) Cosmetics, (34) Soaps,Toiletries and (33) Essential oils

(15) Castor Oil

Total

11090

16530

4731

2179

34530

13752

19788

5609

2983

42132

18610

27730

7436

4571

58347

11

TOP 25 COUNTRIES OF EXPORTS OF CHEMEXCIL’S ITEMS

(Rs. in million)

Region/Countries

U.S.A.

China P. Rep.

Indonesia

Netherland

Malaysia

U.A.E.

Germany

Korea Rep.

Belgium

Brazil

Saudi Arabia

Japan

Singapore

France

Turkey

Pakistan IR

U.K.

Thailand

Italy

Taiwan

Spain

Bangladesh PR

Sri Lanka DSR

Mexico

Egypt A. Rp.

2009-10

32557.1

29400.1

17372.1

16052.9

12246.0

15928.8

10900.1

10819.4

9341.1

11517.6

15296.5

8993.2

9327.9

6516.2

7018.1

15272.3

8560.4

6511.6

9235.7

5782.7

5209.5

4017.7

4211.1

3631.7

3188.9

2010-11

43599.2

37711.1

26715.1

20963.2

11291.4

18450.6

14515.1

13145.4

13199.6

13108.3

14531.6

11210.4

10862.3

10159.8

9422.9

13063.0

10169.5

8754.6

9231

7212.9

9024.8

4792.0

5719.5

3988.4

3500.8

2011-12

65263.8

52815.4

40179.9

30985.0

22331.8

21170.3

18298.0

18153.7

17705.3

17674.0

15083.1

14559.9

14347.8

13843.4

13706.2

13574.5

13554.7

12321.8

11688.2

10181.4

9856.1

7644.0

6598.5

6575.7

5738.6

12

EXPORT OF DYES AND DYE INTERMEDIATES(FOR THE YEARS 2002-03 TO 2011-12)

(Rs. in million)

Year Dyestuff % growth overprevious year

19

63

21

34

39

26

-4

0.4

26.4

Dye Intermediates % growth overprevious year

72

-15

-26

62

73

-21

-1

0.5

4.4

Total % growth overprevious year

29.4

42.4

13.5

36.6

43.4

9.4

-3.6

0.4

24.0

35.3

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

2010-11

2011-12

24240

39594

47936

64064

89210

102320

98290

98700

124780

*

8840

7506

5524

8956

15480

12250

12140

12200

12740

*

33080

47100

53460

73020

104690

114570

110430

110900

137520

186100

* 2011-12 break-up is not available

13

(Rs. in million)

YearU.S.A.17425 13531 8365 9130 8906

297327897171

12404 13009 16888

5769

10000

13406

10882

Malaysia

Pakistan

Netherland7400 5931 3066 2717 2660

S. Arabia7232 8334 10104 6234 2282

Belgium5782 5383 3390 4002 3378

Singapore5614 5278 3572 3356 3924

Turkey5485 3433 3498 2769 2835

Korea Rep5400 3949 3789 6101 8639

Taiwan4613 2659 2287 3847 2341

Spain 4191 3781 1696 3558 3051

Germany4130 4344 3260 5717 5673

Italy 4118 4109 3150 2806 3131

Rs. in million

Year

Indonesia

China

2011-12

30570

20636

2010-11

18640

15182

2009-10

10440

10291

2008-09

14366

6566

2007-08

12721

13277

14

(Rs. in million)

COUNTRY

Indonesia

China P. RP.

U.S.A.

Malaysia

Pakistan Ir

Netherlands

Saudi Arab

Belgium

Singapore

Turkey

Korea Rep.

Taiwan

Spain

Germany

Italy

TOTAL EXPORTS TO TOP 15 COUNTRIES

2011-12

30570

20636

17425

13406

10882

7400

7232

5782

5614

5485

5400

4613

4191

4130

4118

146884

2010-11

18640

15182

13531

5769

10000

5931

8334

5383

5278

3433

3949

2659

3781

4344

4109

110323

2009-10

10440

10291

8365

7171

12404

3066

10104

3390

3572

3498

3789

2287

1696

3260

3150

86483

2008-09

14366

6566

9120

2789

13009

2717

6234

4002

3356

2769

6101

3847

2144

5717

2806

85543

2007-08

1668

10079

8906

2973

16888

2660

2282

3378

3924

2835

8639

2341

2747

5673

3131

78124

TOP 15 COUNTRIES OF EXPORTS OF DYES & DYE INTERMEDIATES FROM INDIA(DURING 2011-12 WITH COMPARATIVE FIGURES FOR PREVIOUS YEARS)

(Rs. in million)

Year InorganicChemicals

% growth overprevious year

32

4

43

14

5

37

65

-1.6

28.1

OrganicChemicals

% growth overprevious year

44

-8

47

19

1

1

32

-4.4

29.9

AgroChemicals

% growth overprevious year

10

-37

-5

47

56

43

47

22.3

19.5

Total % growth overprevious year

32

-13

37

21

10

16

43

3.5

19.7

40.1

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

2010-11

2011-12

9250

9625

13759

15631

16388

22520

37120

36530

46790

*

36880

33928

49802

59146

59894

60240

79580

76190

98950

*

15000

9377

8919

13093

20478

29230

43040

52651

52140

*

61130

52930

72480

87870

96760

111990

159740

165300

197880

277300

* 2011-12 break-up is not available

EXPORT OF INORGANIC, ORGANIC & AGRO CHEMICALS(FOR THE YEARS 2002-03 TO 2011-12)

15

2011-12277300

1978802010-11

2009-10 2008-09

165300

159740

2007-08111990

2006-0796760

2005-0687870

2004-0572480

2003-0452930

2002-0361130

(Rs. in million)

Year

49th Annual Report 2011-2012

Export

16

Basic Chemicals, Pharmaceuticals and Cosmetics Export Promotion Council

China 13537 9980 9218 8007 6861

505469836755

6725 6726 4694

8877

8381

11828

11629

11153 7921 5354 3580 2294

Germany

Brazil

Korea Rp

Belgium9760 6096 5154 4964 3374

Indonesia8902 7480 6064 3556 3819

U.A.E. 8720 9993 7910 4561 3343

U.K. 8581 6280 5329 5238 4041

Japan 7794 6336 5656 4927 2686

Italy 6733 4430 5583 5537 3933

Thailand6583 4374 2887 3009 2208

Malaysia6445 3970 4063 6536 3818

Singapore6237 4182 4339 2827 1675

Rs. in million

Year

U.S.A.

Netherland

2011-12

34297

13834

2010-11

21691

7385

2009-10

16026

7269

2008-09

21776

7137

2007-08

10925

558

17

(Rs. In million)

Region/Country

ASEAN COUNTRIES

China P. Rp.

Korea Rp.

Indonesia

Japan

Thailand

Malaysia

Singapore

Taiwan

Vietnam Soc.Rep.

Australia

Philippines

New Zealand

Hong Kong

Brunei

TOTAL

9222.8

5768.2

6297.3

5621.8

2887.2

4063.0

4338.7

3272.3

2699.9

1963.9

1221.9

499.7

286.5

6.0

48149.2

9980.3

7921.4

7480.1

6336.0

4374.0

3969.8

4182.0

4256.8

2987.6

2316.6

1325.3

562.7

491.0

0.3

56183.9

13536.6

11153.2

8902.0

7794.0

6583.3

6444.5

6236.5

5252.8

3797.8

2813.6

1698.2

875.3

390.7

3.6

75482.1

2009-10 2010-11 2011-12

EXPORTS OF INORGANIC, ORGANIC AND AGRO CHEMICALS(FOR THE YEARS 2009-10, 2010-11 AND 2011-12)

18

EXPORTS OF INORGANIC, ORGANIC AND AGRO CHEMICALS(FOR THE YEARS 2009-10, 2010-11 AND 2011-12)

(Rs. in millions)

Region/Country

CIS COUNTRIES

Russia

Ukraine

Belarus

Azerbaijan

Kazakhstan

Uzbekistan

Armenia

Moldova

Tajikistan

Kyrghyzstan

Turkmenistan

TOTAL

608.7

93.7

18.7

12.9

34.7

15.1

6.8

5.1

5.9

1.2

3.0

805.8

763.8

147.0

1.3

9.9

53.5

41.6

3.7

5.8

7.3

5.1

3.5

1042.5

1144.4

316.0

35.8

23.3

18.2

15.8

10.0

8.3

7.0

3.2

0.8

1582.8

2009-10 2010-11 2011-12

EXPORT STATISTICS OF INORGANIC, ORGANIC AND AGRO CHEMICALS(FOR THE YEARS 2009-10, 2010-11 AND 2011-12)

(Rs. in millions)

Region/Country

TOP 15 AFRICAN COUNTRIES

South Africa

Egypt A. Rp.

Nigeria

Kenya

Tanzania Rp.

Morocco

Ghana

Uganda

Sudan

Cote D’ Ivoire

Ethiopia

Mozambique

Algeria

Guinea

Cameroon

Total

1815.7

1717.8

1696.1

1050.2

609.0

366.9

274.2

282.1

551.5

213.5

536.6

226.0

313.7

165.2

233.8

10052.3

1918.3

1735.6

2192.2

1116.8

843.2

892.9

397.6

414.6

556.0

232.7

170.2

282.2

266.3

208.2

325.3

11552.1

2626.8

2513.1

2429.7

1613.3

1103.0

1054.8

655.3

644.4

595.7

443.9

389.6

376.7

321.2

316.0

231.6

15315.1

2009-10 2010-11 2011-12

19

(Rs. in millions)

Region/Country

LATIN AMERICAN COUNTRIES

Brazil

Mexico

Colombia

Argentina

Chile

Venezuela

Peru

Guatemala

Paraguay

Cuba

Panama Rep.

Bolivia

Suriname

Virgin Is. U.S.

East Timor

Sao Tome

TOTAL

6675.8

2347.9

2741.9

2681.6

831.8

248.5

176.0

349.1

278.3

13.5

10.5

14.3

1.9

0.0

0.4

8.3

16379.8

8380.8

2603.6

1588.9

3301.4

898.2

327.0

319.1

351.6

147.5

71.4

27.2

16.4

10.6

0.0

122.4

0.0

18166.1

11629.0

4414.3

2901.3

2584.4

1471.7

576.0

510.6

467.2

287.8

53.0

50.2

44.9

9.3

5.3

1.3

0.0

25006.3

2009-10 2010-11 2011-12

EXPORTS OF INORGANIC, ORGANIC AND AGRO CHEMICALS(FOR THE YEARS 2009-10, 2010-11 AND 2011-12)

30

YearExport

74360

56090

47310

2011-12

2010-11

2009-10 2008-0944410

2007-0827320

2006-0725490

2005-0622040

2004-0516250

2003-0416450

2002-0316520

(Rs. in million)

20

Saudi Arabia3101 2425 2028 2094 1142

2003 2581 189625972594

2310 1315 1351 805 445

Netherland

Singapore

Malaysia2303 1430 893 907 596

Egypt 2175 1075 759 680 464

Germany2155 1144 783 1075 359

Sri Lanka2099 2484 2279 1487 747

Bangladesh2067 1019 523 481 339

Brazil 2056 1322 1010 940 777

Turkey1830 1250 672 653 476

Japan 1825 1243 975 981 682

Nepal 1680 1214 1016 766 661

3587 2283 1899 868 845

Rs. in million

Year

U.A.E.

U.S.A.

China

2011-12

8385

8232

2010-11

7408

6022

2009-10

6993

5841

2008-09

7118

3957

2007-08

4155

2610

21

TOP 15 COUNTRIES OF EXPORTS OF COSMETICS, TOILETRIES AND ESSENTIAL OILSFROM INDIA DURING 2011-12 WITH COMPARATIVE FIGURES OF PREVIOUS YEARS

(Rs. in million)

COUNTRY

U.A.E.

U.S.A.

CHINA P. REP.

SAUDI ARABIA

NETHERLAND

SINGAPORE

MALAYSIA

EGYPT A.RP.

GERMANY

SRI LANKA DSR

BANGLADESH

BRAZIL

TURKEY

JAPAN

NEPAL

TOTAL EXPORTS TO TOP 15 COUNTRIES

2011-12

8385

8232

3587

3101

2594

2310

2303

2175

2155

2099

2067

2056

1830

1825

1680

46399

2010-11

7408

6022

2283

2425

2597

1315

1430

1075

1144

2484

1019

1322

1250

1243

1214

34231

2009-10

6993

5841

1899

2028

2003

1351

893

759

783

2279

523

1010

672

975

1016

29025

2008-09

7118

3957

868

2094

2581

805

907

680

1075

1487

481

940

653

981

766

25393

2007-08

4155

2610

845

1142

1896

445

596

464

359

747

339

777

476

682

661

16194

22

(Rs. in million)

YearExport

45710

29830

2011-12

2010-11

2009-10 2008-09

21790

21290

2007-0812760

2006-0710900

2005-069400

2004-0510780

2003-046560

2002-034910

49th Annual Report 2011-2012

23

Basic Chemicals, Pharmaceuticals and Cosmetics Export Promotion Council

France6569 4632 2210 4506 2163

140223002465

854 1230 1049

2356

1441

5310

2042

U.S.A.

Japan

Thailand1661 951 837 820 446

Belgium1118 943 321 203 96

U. K. 860 482 358 406 328

Korea Rep.711 466 315 434 242

Turkey591 348 189 273 163

Brazil 480 261 426 162 182

Russia 431 233 110 179 116

Italy 415 264 241 192 173

South Africa330 203 159 210 107

U.A.E.299 231 128 173 88

Rs. in million

Year

China

Netherland

2011-12

15056

7157

2010-11

10266

5051

2009-10

7987

3733

2008-09

4617

3983

2007-08

2315

2679

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TOP 15 COUNTRIES OF EXPORTS OF CASTOR OIL FROM INDIA DURING 2011-12 WITHCOMPARATIVE FIGURES OF PREVIOUS YEARS

(Rs. in million)

COUNTRY

CHINA P. RP.

NETHERLAND

FRANCE

U.S.A.

JAPAN

THAILAND

BELGIUM

U.K.

KOREA RP.

TURKEY

BRAZIL

RUSSIA

ITALY

SOUTH AFRICA

U.A.E.

TOTAL EXPORTS TO TOP 15 COUNTRIES

2011-12

15056

7157

6569

5310

2042

1661

1118

860

711

594

480

431

415

330

299

43033

2010-11

10266

5051

4632

2356

1441

951

943

482

466

348

261

233

264

203

231

28128

2009-10

7987

3733

2210

2465

854

837

321

358

315

189

426

110

241

159

128

20333

2008-09

4617

3983

4506

2300

1230

820

203

406

434

273

162

179

192

210

173

19688

2007-08

2316

2679

2164

1402

1050

446

96

329

243

163

182

116

174

107

88

11555

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Major Competitors in the global market

1. USA

The chemical industry in USA has over 15000 units and employs around 0.9 million workers

directly. The industry accounts for 6.2% of total employment generated by the manufacturing

sector. In addition, it is estimated that around 5 million indirect employment is created by the

chemical industry. With a sales turnover of US$ 380 billion and export turnover of US$ 94

billion, the export orientation of the chemical industry in USA works out to 25% in 2012. The

industry ranks second in terms of productivity – the per employee value added in the US

chemical industry is estimated to be US$ 200 per annum – second amongst all manufacturing

sectors.

2. China

With a sales turnover of US$ 163 billion in 2011, the Chinese chemical industry is third largest

in the world, and second largest in Asia (next to Japan). The growth in the value of output in

Chinese chemical industry is quite high and increasing every year. In the last

one decade, China has displaced France and Germany to move to the third slot in the world

chemical production. The Chinese chemical industry exported goods valued US$ 32 billion in

2011; thus, the export orientation is estimated to be 20%. Chemical majors in China are mainly

public sector firms. However, the Chinese Government continues to actively steer market entry

for foreign companies. There are over 10,000 chemical units in China, majority of

which are set up as joint ventures.

3. Germany

The German chemical industry consists of over 2000 firms; some of them are well-known

household names across the globe. However, over 90 percent of German chemical firms are

small and medium enterprises with less than 500 employees. The chemical industry in Germany

employs around 450,000 persons directly and another 600,000 jobs indirectly. The sales turnover

of German chemical industry is estimated to be US$ 122 billion. With an export turnover of US$

95 billion, the German chemical industry has an export orientation of 77%, one of the largest in

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the world. German chemical industry is estimated to be having 10% share in total manufacturing

output. The industry invests around US$ 10 billion in Research and Development (R&D). The

R&D intensity of German chemical industry is estimated to be around 6%.

4. France

With a sales turnover of US$ 90 billion, the French chemical industry is the fifth largest in the

world and second largest in Europe. The chemical industry in France is second largest

manufacturing sector, next to Automobiles, and exports around 60% of its turnover. The industry

has around 1000 units providing employment to around 200,000 persons. With an export

turnover of US$ 51 billion, the chemical industry in France is the largest exporting sector.

Exports accounted for one-sixth of total exports of the manufacturing sector in France. The R&D

intensity of the French chemical industry was over 3% of sales, while the R&D budget

represented over 20% of the total value of investment into industrial R&D in France.

5. Italy

Chemical industry in Italy is the third largest in Europe, after Germany and France. In the year

2012, the production of Italian chemical industry was valued at US$ 60 billion. The industry

employs around 130,000 persons. The industry is well represented by small and medium

enterprises (42% of total units), Italian large enterprises (23%), and foreign multinationals

(35%). Export turnover of Italian chemical industry was US$ 26 billion in 2005; the export

orientation of the Italian chemical industry thus works out to 43% in 2005. Exports to turnover

have grown from 15% to 43% in 15 years, the best performance among European countries. Not

only large firms, but also SMEs in Italy are strongly oriented to international markets. According

to a survey by Federation of Italian Chemical Associations (FEDERCHIMICA), over 70% of

Italian chemical enterprises are engaged in R&D activities.

6. United Kingdom

Chemical industry is one the largest manufacturing sectors and top ranking export sector in UK.

In 2011, the UK chemical industry produced goods worth US$ 50 billion, and accounted for

around 2% of national GDP and over 10% of gross value added in the manufacturing sector.

Exports of chemicals by UK were estimated to be US$ 38 billion in 2005. The export intensity of

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the UK chemical industry thus works out to 76%. The UK chemical industry provides direct

employment to around 200,000 persons and helps in creation of indirect employment to equal

number of persons. In 2005, the chemical industry in UK made a capital investment of around

US$ 2 billion, which is over 10% of capital investment in manufacturing sector. R&D intensity

of UK chemical industry is estimated to be 3% in 2004.

Source: http://www.chemexcil.gov.in/TopCountries.aspx

Provisions in India’s Foreign Trade Policy

Export of dual-use items and technologies under India’s Foreign Trade Policy is regulated. Export of dual-use items and technologies is either prohibited or is permitted under a licence. In Foreign Trade Policy, dual-use items have been given the nomenclature of Special Chemicals,

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Organisms, Materials, Equipment and Technologies (SCOMET). Export Policy relating to SCOMET items is given in Appendix 3 of Schedule 2 of ITC (HS) Classification and Paragraph 2.49 of Hand Book of Procedures Vol.-I, 2009-14. Appendix 3 of Schedule 2 of ITC (HS) Classification contains a list of all dual-use items and technologies export of which is regulated.

List of Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) items

In the list as appearing in Appendix 3 of Schedule 2 of ITC (HS) Classification, SCOMET items are listed under eight (8) categories as follows:

Category 0 Nuclear materials, nuclear-related other materials, equipment and technology. (The licensing authority for this category is the Department of Atomic Energy)

Category 1 Toxic chemical agents and other chemicals

Category 2 Micro-organisms, toxins

Category 3 Materials, Materials Processing Equipment, and related technologies

Category 4 Nuclear-related other equipment, assemblies and components; test and production equipment; and related technology, not controlled under Category 0

Category 5 Aerospace systems, equipment including production and test equipment, related technology and specially designed components and accessories thereof.

Category 6 (Reserved)

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Category 7 Electronics, computers, and information technology including information

security.

 

Each category contains exhaustive listing of items covered under that category. Special conditions applicable to items under different categories are mentioned under each category.

Quality Standards

ISO has developed over 19 000 International Standards and all are included in the ISO

Standards catalogue. The Standards used by CHEMEXCIL are:-

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Challenges Faced by the Exporter

Indian chemical sector has grown a long way since its early days of independence. The sector

has grown from a small-scale sector to multi-dimensional sector, which is taking on the

challenges of globalization. Now, Indian chemical industry holds a recognized position in the

global map; however, there are few factors, which hinders the growth of the industry. These

include:

1. High Price of basic feed stock - Basic raw materials constitute major portion of cost of

production (30%to 60%) in the chemical industry. Indian chemical industry either uses

natural gas or crude oil as feedstock for manufacturing process. The fluctuations in oil

prices therefore affect the growth projections of the firms. At times, the manufacturers

are unable to pass-on the cost escalation (occurring due to sudden increase in oil prices)

to end consumers. Cost optimization is thus critical for the chemical units, as their

margins may go under pressure during oil crisis.

2. SSI reservation / Fragmented nature of industry - The Indian chemical industry is

having a fragmented structure with more number of units in small-scale sectors spread in

various parts of the country. The installed capacities in most of the small-scale units are

smaller as compared to global scales. The limitation in capacity in the SSI sector put

them in disadvantageous position while tapping export opportunities with large volume.

3. Low R&D Levels - R&D intensity is assuming greater significance for many of the

manufacturing segments. Since, chemical industry is a knowledge- based industry, the

competitiveness of the units can be strengthened only through supply of new and

innovative products. The areas for R&D in chemical industry include improvements in

manufacturing process for reduction in cost of production, application development to

diversify demand, and new product development. The level of R&D investments in the

Indian chemical sector is low at around 0.3% of total sales.

4. Environmental Regulations - Safety, health and environment protection issues are

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becoming important concerns for the Indian chemical industry. As with other industries,

the chemical industry needs to comply with regulations such as Occupational Safety and

Health and Process Safety Management regulations. Environmental safety, occupational

safety and process management safety can easily be met if a firm is manufacturing large

volume of single chemical. But it may not be

Relevant News articles

1. Chemexcil seeks opportunities in South AfricaPress Trust of India / Johannesburg July 27, 2012, 16:05

South Africa presents great opportunity for Indian chemical companies if they could ensure quality rather than quantity, Indian High Commissioner Virendra Gupta has said.

"South Africa is a highly quality-conscious market, so I think the key issue is not the size of the Indian company, but the kind of quality that you can consistently adhere to. There is considerable opportunity for entry for small and medium sized entrepreneurs," Gupta told a delegation from the Chemicals, Pharmaceuticals and Cosmetics Export Promotion Council (Chemexcil) here yesterday.

As many as 68 Indian exporters and manufacturers from Chemexcil are participating in a two-day buyer-seller meet to boost business in South Africa.

The representatives are providing details on a diverse range of products including adhesives, basic chemicals, cosmetics, detergents and other industrial chemicals.

Gupta said there was great opportunity for mutual benefit in the phosphate sector in particular, as India imported a lot of phosphates from South Africa.

Chemexcil Chairman Satish Wagh concurred that there was a lot of opportunity for joint ventures in the nine sectors in the chemical industry in South Africa.

2. India, Nigeria trade crosses $17 billion in FY12

PTI Aug 1, 2012, 08.10PM IST

The bilateral trade between India and Nigeria has risen by over 36 per cent to USD 17.3 billion in the fiscal ended March, 2012.The trade between the two nations stood at USD 12.7 billion in 2010-11.

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Exports rose to USD 2.7 billion in FY2011-12 from USD 2 billion in the previous fiscal, while imports stood at USD 14.6 billion as against USD 10.7 billion in 2010-11, Indian High Commissioner to Nigeria, Mahesh Sachdev, said quoting official data.

He was speaking at the opening ceremony of the first Indian-Nigerian Chemical Products Buyer-Seller Meet in Lagos yesterday.

Nigeria constitutes nearly a quarter of India's trade with the African continent, making it the largest trading partner in the region, he said.

"India's chemical sector is estimated to have quadrupled in size during last decade, catapulting India as a major international player," Sachdev told a group of businessmen at the meeting of India's Basic Chemical, Pharmaceutical and Cosmetic Export Promotion Council ( CHEMEXCIL).He stated that chemicals from India have a prominent place in Nigeria's import basket, adding that India supplies Nigeria around USD 0.5 billion worth of basic chemicals, pharmaceuticals and cosmetics annually.

"India has traditionally been Nigeria's first source of pharmaceuticals and potential exists for similar Indian presence in various other similar consumer segments," Sachdev said.

He added that far-reaching developments in Nigeria, including passage of Petroleum Industry Bill in near future, are likely to spur Nigeria's own chemical sector into an era of rapid growth.

Nigeria is Africa's biggest oil producer and its major export to India is crude, while the country imports chemicals, pharmaceuticals and textiles from India.

Biesterfeld works with India’s Chemexcil on Reach legislation

23 June 2009 15:02  [Source: ICIS news]HELSINKI (ICIS news)--German distributor Biesterfeld is cooperating with Chemexcil, an Indian government organisation, on Europe’s Reach legislation, the company said Tuesday.Speaking on the sidelines of the FECC Congress in Helsinki, Finland, Biesterfeld CEO Birger Kuck said that subsidiary Biesterfeld ChemLogS would help small and medium-sized enterprises (SMEs) in India by providing training and consultancy work, as well as pre-registering and registering products.The alliance would reduce considerably the expenses involved, Kuck said.The deal with Chemexcil, which followed a visit by a German delegation to the country in November last year, would mainly focus on dyes, asIndia is a major exporter of dyestuffs to Europe. Speciality chemicals and some basic chemicals would also be included.“Our advantage is that, as a distributor, we know and understand chemicals. Some companies offering Reach support do not have that knowledge,” Kuck said.Biesterfeld is also acting as an Only Representative for a Korean company, but Kuck said that he was not actively looking to replicate the Indian partnership in other non-European countries.“We have limited capacity to do that. Mainly we are offering this service to Biesterfeld’s suppliers outside the EU, such as China, Korea and Taiwan,” he said.Reach is Europe’s system for chemical safety regulation.The FECC Congress runs Tuesday and Wednesday

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References

ANNUAL REPORT 49TH WEB – CHEMEXCIL (2011-2012)

[http://chemexcil.gov.in/Download.aspx]

Statistics – CHEMEXIL’S EXPORT

[http://chemexcil.gov.in/Chemexcil%20Exports.aspx]

Statistics - TOP COUNTRIES OF EXPORTS OF CHEMEXCIL’S ITEMS

[http://chemexcil.gov.in/TopCountries.aspx]

Statistics – TOP 15 COUNTRIES OF EXPORTS OF DYES & DYE

INTERMEDIATES FROM INDIA DURING 2009-10 WITH COMPARATIVE

FIGURES FOR PREVIOUS YEARS

[http://chemexcil.gov.in/Top%20Item%20Export.aspx]

ISO Standards - Chemical Technology

[http://www.iso.org/iso/home/store/catalogue_ics/catalogue_ics_browse.htm?ICS1=71]

ISO Standards - Paint and Color Industries

[http://www.iso.org/iso/home/store/catalogue_ics/catalogue_ics_browse.htm?ICS1=87]

Provisions in Foreign Trade Policies

[http://www.commerce.nic.in]

News Article – Chemexcil seeks opportunities in South Africa

[http://www.business-standard.com/generalnews/news/chemexcil-seeks-

opportunities-in-south-africa/37347]

35

News Article - India, Nigeria trade crosses $17 billion in FY12

[http://articles.economictimes.indiatimes.com/2012-08-01/news/

32981286_1_nigeria-petroleum-industry-bill-mahesh-sachdev]

News Article – Chemexcil seeks opportunities in South Africa

[http://www.icis.com/Articles/2009/06/23/9226990/biesterfeld-works-with-indias-

chemexcil-on-reach-legislation.html]

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