Chemical industry calls for cracker project to boost growth in Tamil Nadu

Chemical industry in Tamil Nadu faces challenges, seeks government support for cracker project, growth projections shared at Chemvision 2024.

A significant disadvantage that the chemical industry has in Tamil Nadu is the lack of a cracker, said Ramkumar Shankar, Managing Director of Chemplast Sanmar Ltd.

“We request the State government to use its goodwill to get a cracker project sanctioned by one of the national oil companies,” he said while talking at Chemvision 2024, an exclusive conference for the chemical industry that was organised by the Confederation of Indian Industry (CII) Tamil Nadu. A cracker unit takes naphtha from a refinery and cracks it into basic petrochemical feedstocks like ethylene, propylene etc.  

Mr. Shankar also shared some statistics on the chemical industry. “The Indian Chemical Council (ICC) estimates that the country’s chemical industry, which was worth around $170-180 billion in 2021 (around 5% of India’s GDP), is expected to grow around $290-310 billion by 2027 and to $850 billion - $1 trillion by 2040. Multiple tailwinds, including the favourable demographics of India, the rising disposable income, China plus 1 etc, are expected to fuel this growth,” he noted.

“The trade deficit in our sector, however, is likely to worsen – from around $9 billion in 2021, it is expected to grow to around $15 billion by 2027 and $40 billion by 2040,” he added.

D. Sneha, Executive Director of State Industries Promotion Corporation of Tamil Nadu (SIPCOT), highlighted the Corporation’s role in hosting chemical manufacturing firms across all its parks in the State. “We will continue to strengthen infrastructure for the chemical industry,” she noted.

“The proposed Nagapattinam refinery, envisioned as a joint venture between CPCL and Indian Oil, is set to be a game-changer for the region’s petrochemical industry. With the basic configuration complete and awaiting final government clearances, this refinery is expected to serve as a cornerstone for the development of a thriving petrochemical ecosystem in the area,” said H. Shankar, Managing Director of Chennai Petroleum Corporation Limited (CPCL).

The State is keen to develop Petroleum Chemicals Petrochemical Investment Regions (PCPIRs), with Nagapattinam being a key focus, he said. With the polymer park alongside the refinery, it will further enhance this vision, positioning the region as a major player in India’s petrochemical future, he added.