Q. Could you tell me what value proposition do you offer to your associate members? A. ICC provides its members a forum to debate and address industry's issues that are common to members. ICC conducts seminars and conferences and provides extensive networking opportunities for members. Further, a large number of training programs are organised for professionals from Indian chemical industry. The council represents the Indian chemical industry at national and global forum. It is also promoting members' interest through its representation to government on fiscal and regulatory matters. ICC is engaged in taking Indian industry to global fraternity through a series of MOUs. ICC has MOUs with almost all the leading chemical associations across the world like USA, UK, China and many others. On environmental front, ICC promotes safety, health and environmental issues by promoting responsible care initiatives. ICC is now promoting the Greenhouse gas inventorisation where our member companies will commit for voluntary reduction in Green House gas emission. ICC has also established a Process Safety Centre which provides training in Process Safety to ensure safe operation of chemical plants. ICC presents annual awards in recognition of achievement of excellence and outstanding contributions to the chemical industry in various categories like innovation, responsible care, safety, health, life time achievement etc.

Q. Can you provide a brief overview about the global chemical industry vis-à-vis Indian counterparts? What is India's role in the Global Chemical Economy?

If we compare the size of chemical industry, global chemical industry is about US$ 3 tn. comparatively, India is a relatively small player as Indian industry is worth only around US$ 60 bn. The petrochemicals, pharmaceuticals and the specialty chemical segment of the Indian chemical Industry have a considerable presence in the global chemical industry. India also has a major presence in agrochemicals.

Q. Could you comment on the performance of the Indian chemical industry over the past three years? How has the industry performed?

The financial years - FY07 and FY08 were excellent and saw the industry growing at very rapid pace both in terms of sales as well as profitability. However, during FY09 the financial crisis in the western part of the world and the consequent economic turmoil had its impact on the Indian chemical industry as well. The Indian chemical industry passed through a turbulent time. However, currently the growth is picking up.

Q. How has the global slowdown impacted Indian chemical industry?

The drugs and the pharmaceutical sectors which have large exposures to the western world due to exports have suffered. Whereas the producers focused on Indian market with limited exposure to exports, are relatively better off. Nevertheless most of them saw some margin collapse. Many segments were faced with surge of low priced imports from global producers, because Indian market was doing well. Many low price producers had started exporting to India as Indian markets were holding up better as compared to the rest of the world. Now with the Indian economy picking up, the chemical sector is also recovering.

Q. How is India placed on the major sectors like chlor-alkali chemical, basic inorganic chemicals & organic chemical sectors?

Technologically some of segments in inorganic chemicals are at par with more advanced countries of the world. For instance, in the caustic soda production India has totally moved away from mercury cell to membrane cell technology while many European countries still employ mercury cell technology.

Q. What are the issues and challenges faced by Indian chemical industry and the chemical companies in general?

The major challenge that the chemical industry faces today is the perception that it affects the environment. The industry is viewed with a high degree of apprehension on the pollution and sustainability fronts. Products from chemical industry have dramatically altered the quality of life world over and have contributed significantly to our day-to-day requirements. However, the perception is changing slowly with ICC's efforts and this image will also change for the better in the near future.

Q. How are Indian companies coping up with REACH?

REACH compliance has come as a major challenge to Indian companies which have a large exposure to European export market. Many of them who have completed initial pre-registration process are now faced with huge cost of registration. While REACH is a well intended, the implementation of REACH by European Union seem to have a major cost and operational challenges especially for many SMEs from India. These SME's will find it difficult to handle it because of high registration cost. The consumers in the European Union maybe deprived from sourcing of products from more cost efficient producers from the developing world including India. However, as of now the long-term impact from it is not at all apparent in terms of export realisation. This would become clear once the registration deadline of REACh gets over.

Q. What steps has the ICC and the Government undertaken to improve India's export competitiveness in the chemical segment?

ICC has made several recommendations to government that includes various tax concessions etc. ICC has also undertaken training program for improvement in manufacturing technology and processes and advises about cost cutting measures. Training program to upgrade skills, highlight fiscal, infrastructure and regulatory bottlenecks to the government is also done by ICC. Some of the issues raised by ICC have already been addressed by the government and ICC is confident that others would be appropriately addressed in the near future.

Q. What products (chemicals) and markets are likely to drive India's chemicals exports in the coming years?

Drugs and petrochemicals are very clearly two major segments that are driving Indian chemical export. But we also expect fine chemical, dyes and intermediates and then knowledge based chemicals and contract research to play a significant role in driving the growth of the Indian chemical industry.

Q. What are the efforts taken by ICC to tackle environmental issues arising due to chemical industry?

ICC has tied up with Global Chemical Industry Association to address this vital issue. Responsible Care program is one such initiative by ICC that focuses on environmental issue. Interestingly, a recent study by an independent agency has found that products from chemical industry are amongst the top greenhouse gas emission savers.

Recently ICC is now doing a Global Product Strategy (GPS) and also organising a seminar based on same. We are organising various programs to educate our members on environmental issues and ICC is helping its members to tackle all the environment related issues.

Q. How can the companies operating in this sector maintain their competitiveness to compete in the domestic as well as international market?

Upgradation in technology would be the key to maintain competitiveness. Global chemical industry has to innovate to make available products to the bottom of the pyramid segment of our population at affordable cost. Therefore industry needs to innovate and find out all cost cutting exercises without affecting quality.

Q. What are the growth prospects of the Indian chemical industry?

Indian chemical industry is comparatively nascent as compared to the advance world; the industry at present is less than one-sixth of the size of the Chinese Chemical industry. Moreover, our per capita consumption of various chemicals is comparatively very less. Hence India has a huge potential to grow.

To conclude, chemicals are essential to life but then they have to be produced in a sustainable way. ICC is educating its members regarding this. For instance, even though greenhouse gas inventorisation is not compulsory, our members are initiating it voluntarily and ICC is supporting and propagating it. With this initiative and industry's proactive actions definitely the chemical industry's image will improve and it will grow further.