India's chemical and pharmaceutical industry gains traction as Europe faces decline: Nuvama

India is emerging as a key player in the global pharmaceutical Contract Development and Manufacturing Organisation (CDMO) sector while rapidly expanding its production in fine chemicals, agrochemicals, and specialty chemicals, according to a report by Nuvama. The report highlights that government incentives and lower operational costs drive this growth, positioning India as an attractive alternative to Europe, where rising energy and labour costs erode its competitive edge. 

Multinational firms are increasingly shifting production to India, reshaping the global market. The report notes that while Europe remains strong in manufacturing high-value Active Pharmaceutical Ingredients (APIs) and finished dosage forms, it is losing ground in low-cost generic API production due to outsourcing to India and China. Europe continues to lead in high-value CDMO services such as biologics, oncology APIs, and advanced drug formulations. However, its share in global chemical sales has declined from 23% in 2008 to 13% in 2023, driven by major plant closures. These shifts are accelerating India's small-molecule pharmaceutical research industry and boosting agrochemical exports, supported by favourable regulations.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.