Indian specialty chemical business grow $100 bn by 2020: McKinsey

Indian specialty chemical business can grow to $100 bn by 2020: McKinsey

11:10 PM, 26th February 2012
Indian specialty chemical business can grow to $100 bn by 2020: McKinsey

NEW DELHI, INDIA: The Indian specialty chemicals industry has potential to grow to $80-100 billion by 2020 from the present $22 billion, said a report by McKinsey, the global consulting firm. “We estimate that by 2020, India has potential to grow the specialty chemicals industry from $22 billion to between $80-100 billion,” mentioned McKinsey & Company, in its report, ‘Building a global scale specialty chemical industry in India.’

According to McKinsey, global chemicals industry - the largest manufacturing industry in the world - registered sales worth $2.5 trillion in 2010 of which specialty chemicals comprised 20 per cent. About one-third of the global specialty chemicals business could move to Asia by 2020, it added. “By 2020, approximately $350 billion of the projected $1 trillion global specialty chemical industry could move to Asia (excluding Japan), driven by downstream demand and competitive manufacturing costs,” the firm noted.

The specialty chemicals industry in India could lead to $20-25 billion investments and can create 700,000 to 800,000 additional jobs in the sector, it noted. However, for the success of the industry in India, McKinsey has suggested that the sector needs to develop local products at the right price, use merger & acquisitions and partnerships to grow, build a strong value proposition to attract talent, among other factors.

The agency has also suggested for the government of India to help in facilitating success of the specialty chemicals industry. These include encouraging specialty chemicals companies to set up plants in petroleum, chemicals and petrochemicals investment regions (PCPIRs), upgrade chemical industries to address likely talent shortfall and upgrade industrial training institutes. Government should also establish a specialty chemicals forum to define relevant consumption standards and drive innovation and establish a database of chemical inventory of the country chemicals sector among other suggestions, added McKinsey.

© News Agencies, India

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