Editorial September 2023 Where are we headed 2023 2024

Rajiv Parikh

14 Sep 2023

PM Modi has his own charisma! Recently after the G20 where the world leaders were surprised at how well the event was organized, the praise for PM Modi was astounding. The route from India to the Middle East is a direct challenge to the Belt and Road Initiative from China.

This was something unexpected and the way geopolitics is shaping has far surpassed any other leader’s strategy in the past not just in India but across the globe. The core agenda of the Prime Minister is just growth. He wants that India become the world’s number one country for travel, for culture, for business for road infrastructure, for policies, for anything which makes the human race successful including energy and chemicals sectors which is the base of any civilization to flourish. My personal opinion is that, if you cannot see what PM Modi is doing for the betterment of India and also the world, you might want to reconsider and view from a different frame of reference. Only if all pockets of the country have factories, increased manufacturing capacity, extreme employment where people can flourish and earn a good acceptable living, there’s no way India will one day be a “golden sparrow”.

Recently in the petrochemical sector, PM Modi laid the foundation stone for Rs. 49,000 crore ($5.9BN) Petrochemicals Project at BPCL’s Bina Refinery in Madhya Pradesh. This project involves increase in BPCL’s Bina Refinery capacity from 7.8 MMTPA to 11 MMTPA. This opens up jobs for almost 15,000 employees and once completed will generate about 100k direct and indirect employment and thus proper the state and the area. The long terms impact is, it will save Forex outgo of about 20,000 crores per year preventing importing of petroleum products and this making India further self-reliant. Its estimated completion time is about 5 years with state of art infrastructure in and around Madhya Pradesh. Prime Minister Narendra Modi said, "I guarantee you that the Petrochemical Complex at Bina Refinery will spur growth in the entire region and take development to new heights." Prime Minister also mentioned that it will not only give rise to new industries but benefit the small farmers and entrepreneurs and create thousands of opportunities for the youth.

Speaking on the occasion, G. Krishnakumar, Chairman & Managing Director, Bharat Petroleum Corporation Ltd. said, "Our Rs 49000 crore investment in the Ethylene Cracker Project at Bina is demonstrative of our firm commitment in expanding BPCL's energy envelope with a future ready product portfolio in the petrochemical space and becoming a major participant in our Government's mission of building the country as a globally competitive and preferred manufacturing destination." The planned petrochemical complex is expected to have a cracker with a 1.2m tonne/year ethylene capacity; a 650,000 tonne/year LLDPE/HDPE (linear low density polyethylene/high density PE) swing plant; a 500,000 tonne/year HDPE unit; a 550,000 tonne/year polypropylene (PP) line; and a 50,000 tonne/year butene-1 unit, based on BPCL’s September 2022 report submitted to the Ministry of Environment, Forests and Climate Change.

The chemical industry trends in 2023 showcases the following important points. Focus is and will be on sustainability as more and more countries tries to be carbon neutral or net zero by 2050. Digtalization of the industry is the next big and important factor. This is and will be required if we want to integrate AI in to our day to day production mechanism and control the systems based on past and expected performance matrix. Digitalization will also help to improve sales and increase profits as most of the tasks will be taken care by considering the numbers at hand. The third and the most important thing is localization and reshoring as we realized that during the pandemic, it was important to be self-reliant and thus self-sufficient. This trend is also driven by geo-political tensions, need to produce at home for better accountability and sustainability and changing customer preferences. With the new virus making trends on twitter (Now X), it is important to be at the forefront to develop new products and solutions to help improve health and wellness, such as antimicrobial coatings and materials, disinfectants and hygiene products. This is also a boost in the pharmaceutical sectors which are dependent of APIs and chemical/drug raw material to build a final product.There has also been a rising interest in chemical recycling which is a process that converts waste plastics into chemical feedstocks or fuels, creating a circular economy for plastics. This is turn also has created focus on ESG which are important factors for investors and stakeholders which forces these companies to have greater emphasis on sustainability, diversity and ethical governance to maintain a positive reputation and be a reputed name in the industry for doing their own for the environment and people. Then the last but not the least is greater emphasis on specialty chemicals which are high-value, low volume chemicals used in various industries including pharmaceuticals, electronics and personal care.

 

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