Chemical Industry india

The Indian chemicals industry is highly diversified, covering >80,000 products and employing >2 million people.

Advantage India

Growing
Demand

* Rise in demand from end-user industries such as food processing, personal care and home care is driving the development of different segments in India’s specialty chemicals market.

* India is the sixth largest producer of chemicals in the world and third in Asia, contributing 7% to India’s GDP.

* Chemicals and petrochemicals demand in India is expected to nearly triple and reach US$ 1 trillion by 2040.

* Exports of Chemicals and allied Products reached US$ 9,194 million during FY26 (April-June).

Growing Demand

Opportunities

* India’s specialty chemicals companies are expanding their capacities to cater to rising demand from domestic and overseas.

* With global companies seeking to de-risk their supply chains, which are dependent on China, the chemical sector in India has the opportunity for a significant growth. ​

* In the specialty chemicals sector, manufacturers are focusing on green solvents, biodegradable surfactants, and bio-based polymers, with India’s green chemicals market expected to grow at a CAGR of over 10% and exceed US$ 15 billion by 2027.

Opportunities in Chemical Industry

Policy
Support

* As part of the Union Budget 2025-26 the government allocated Rs. 1,61,965 crore (US$ 18.7 billion) to the Ministry of Chemicals and Fertilizers.

* The PLI plan for the National Programme on Advanced Chemistry Cell Battery Storage has been approved by the Union Cabinet as of May 2021.

* PLI schemes were introduced to promote Bulk Drug Parks, with a budget of Rs. 1,629 crore (US$ 213.81 million).

* The Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR) set up at Paradip has attracted investments worth Rs.73,518 crores (US$ 8.84 billion) resulting in employment of about 40,000 people.​

Policy Support

Increasing
Investments
and spending

* FDI inflows in the chemicals sector (other than fertilizers) reached US$ 23.4 billion between April 2000-June 2025.

* Odisha is aiming to transform into a leading petrochemical hub, targeting investments of Rs 1.2 trillion (US$ 13.6 billion) by 2035 (over the next ten years).

* The Dahej PCPIR project in Bharuch, comprising 180 existing and 650 under construction industrial units has attracted an investment of Rs. 1 lakh crore (~US$ 12 billion) and is expected to generate 32,000 jobs.

*The "Power and Renewable Energy Manufacturing Zone, Narmadapuram," whose construction is anticipated to cost about Rs. 460 crore (US$ 55.5 million), would contribute to the economic growth and employment generation of the area.

Increasing Investments and Spending
Last updated: Oct, 2025

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