Outlook: Polymers in Indian and Abroad, Features - Personality

P. K. Johri
CEO
ONGC Petro additions Limited (OPaL), Mumbai

Indian presence in petrochemicals business cannot be ignored. With the Indian economy doing better than most of the other economies of the world; polymer consumption too is getting the much desired lift.

Global per capita of consumption plastic is around 25 Kgs. Developed economies like US, W. Europe and China have per capita consumption around 90 Kgs, 65 Kgs and 30 Kgs. respectively. India is placed amongst the lowest in the tally at 5 Kgs.

India needs investiments in enhancing the petrochemical capacity to keep pace with the growing demand.

Polymers growth last year was over 17%. Indian demands for polymers are expected to double by 2016. Today, apart from Polypropylene (PP), all other polymers are in deficit. By 2016, after considering all the planned capacity additions identified till date, India will still be in shortage of all polymers including PP.

To cater to this growing Indian demand, investment of over US $ 10 bn would be needed. Lately, there has been a strategic shift in the Government owned oil and gas companies, oil marketers, oil refiners and exploration companies which have initiated investment in the petrochemical sector. IOCL, HPCL and ONGC have announced investments in the sector. We expect many more companies with oil and gas background to go for downward integration in petrochemical sector.

ONGC Petro additions Limited is promoted by ONGC. OPaL is now building up India’s largest Petrochemical complex at Dahej SEZ, Gujarat. OPaL’s dual feed cracker with capacity of 1.1 Million MT will be the largest in India with investment over US $ 3 bn. OPaL will produce PE (1100 KTA), PP (340 KTA) and other associated chemical products with capacity of 600 KTA. We will initially export polymers worth more than US $ 1 bn, annually.

Global polymer business will go through downturn in the next two years. However, by 2013; we will see an upcycle in Petrochemical demand worldwide and will bring good times for the Petrochemical Producers.

Overall, I can foresee a good future for the Indian Petrochemical Industry.

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Outlook: Polymers in Indian and Abroad

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