India’s chemicals and petrochemicals sector is expanding its manufacturing capabilities, attracting investments and strengthening its global presence through dedicated industrial parks, research initiatives and infrastructure development.
The sector is also focusing on technological advancement, skill development, quality standards and workplace safety to promote sustainable industrial growth and enhance its participation in global value chains.
Strategic importance of the sector
India is the world’s sixth-largest producer of chemicals and the fourth-largest in Asia. Valued at around USD 220 billion, the sector is projected to reach USD 300 billion by 2030 and USD 1 trillion by 2040.
India is also the second-largest manufacturer and exporter of dyes and the world’s third-largest exporter of agrochemicals. The industry comprises approximately 13,000 large-scale units and 4.45 lakh micro, small and medium enterprises (MSMEs).
Chemical products cater to several key industries, including pharmaceuticals, textiles, construction, automobiles, electronics and consumer goods.
India Chem 2026 promotes investment and global collaboration
The 14th edition of India Chem 2026 was organised in Mumbai from October 22 to 24, with the theme ‘Advantage Bharat: An Emerging Global Chemicals Hub’.
The three-day event aimed to attract investments and promote sustainable growth in the chemicals and petrochemicals sector. It witnessed more than 5,000 visitors and brought together industry leaders and businesses through country forums, a CEO Forum and sector-specific roundtables.
The exhibition showcased emerging technologies, equipment and investment opportunities. The inaugural India Chem Youth Innovation Challenge also encouraged students to develop practical, research-based solutions.
Expanding manufacturing capacity and investment
India allows 100 per cent foreign direct investment (FDI) through the automatic route in most chemical sectors.
FDI inflows into the sector reached Rs 1,04,895 crore during 2014-2026, more than double the Rs 45,240 crore recorded between 2004 and 2014.
Production of major chemicals and petrochemicals increased from 45,638 thousand metric tonnes in 2015-16 to 58,617 thousand metric tonnes in 2024-25, reflecting the expansion of domestic manufacturing capacity.
Petroleum, Chemicals and Petrochemicals Investment Regions
The government has developed Petroleum, Chemicals and Petrochemicals Investment Regions (PCPIRs) to promote integrated industrial development.
Each PCPIR is a specially designated investment region covering approximately 250 square kilometres, with around 40 per cent of the area reserved for processing activities.
These regions provide common infrastructure and utilities, including road and rail connectivity, ports, Common Effluent Treatment Plants, sewage disposal facilities, water supply and steam generation units.
India has three operational PCPIRs at Dahej in Gujarat, Visakhapatnam-Kakinada in Andhra Pradesh and Paradeep in Odisha.
Together, these regions have attracted investments worth Rs 3.4 lakh crore, generated 3.7 lakh jobs and facilitated the establishment of more than 2,200 chemical manufacturing units.
BHAVYA Rasayan scheme for dedicated chemical parks
The Bharat Audyogik Vikas Yojana Rasayan (BHAVYA Rasayan) Scheme, approved in July 2026, aims to establish three dedicated chemical parks across the country.
Each park will cover at least eight square kilometres, equivalent to 2,000 acres. The Centre will provide grants of up to Rs 1,000 crore per park, subject to a minimum contribution of Rs 500 crore from the respective state government.
The scheme has a total financial outlay of Rs 3,030 crore, including Rs 3,000 crore for common infrastructure and basic utilities and Rs 30 crore for administrative expenses. It will be implemented over five years, from 2026-27 to 2030-31.
The parks will provide plug-and-play infrastructure, centralised effluent treatment facilities, storage and disposal systems and hazardous waste management infrastructure. The initiative aims to attract investments, reduce logistics costs, improve resource utilisation and strengthen domestic production capacity.
Plastic Parks to strengthen downstream processing
The Scheme for Setting up of Plastic Parks aims to enhance polymer absorption capacity and promote value addition in the domestic plastic processing industry.
These dedicated industrial zones seek to consolidate plastic processing capacities, encourage investment, increase production and exports, and generate employment.
Under the scheme, the government provides grants covering up to 50 per cent of the project cost, subject to a maximum of Rs 40 crore per project. The remaining expenditure is met by state governments, their agencies and beneficiary industries.
The parks also promote sustainable industrial practices through waste management and recycling initiatives.
Ten Plastic Parks have been approved across the country, of which four have achieved 100 per cent infrastructure completion. Three of these were completed during 2025-26.
Promoting research, innovation and skill development
With chemical applications expanding across industries, the government is supporting specialised research, technical education and industry-oriented skill development.
Under the Chemical Promotion and Development Scheme (CPDS), the government promotes knowledge creation, research and innovation through studies, surveys, databases, workshops and seminars. The scheme also provides financial assistance to organisations, industry associations and other institutions for research and promotional activities.
Since 2016, public sector undertaking HIL (India) Limited has conducted farmer training programmes under the scheme. The Institute of Pesticide Formulation Technology (IPFT) also began conducting such programmes in 2022-23.
The programmes promote the safe and judicious use of pesticides and encourage Integrated Pest Management practices to minimise pesticide residues in food grains, edible oils, fruits and vegetables.
As of August 2026, more than 250 such programmes had benefited over one lakh farmers across the country.
Research, Development and Innovation Scheme
Launched in November 2025, the Research, Development and Innovation (RDI) Scheme has a corpus of Rs 1 lakh crore to encourage private-sector investment in research and innovation.
It provides long-term financing and refinancing on favourable terms for transformative projects, with the objective of accelerating advanced technology adoption, strengthening industrial competitiveness and promoting self-reliance in critical and emerging technology areas.
From October 8, 2026, Advanced Chemicals, Petrochemicals and Material Technologies were included as an additional eligible technology area under the scheme. The move is expected to support sector-specific research and the development of indigenous technologies for advanced industrial applications.
CIPET expands technical education and industry support
The Central Institute of Petrochemicals Engineering and Technology (CIPET), a centrally funded technical higher education institution, supports the petrochemical and allied industries through skill development, technology support, academic programmes and research.
Its facilities include Centres for Skilling and Technical Support (CSTS), Plastic Waste Management Centres (PWMC), the School of Advance Research in Petrochemicals (SARP), the Advance Research School for Technology and Product Simulation (ARSTPS) and the Advance Polymer Design and Development Research Laboratory (APDDRL).
CIPET’s network has expanded to 51 centres, including 19 established since 2014. Three centres are dedicated to plastic waste management.
The institute has trained nearly 6.72 lakh skilled professionals, including more than 5.21 lakh during 2014-24. It also completed 8.53 lakh technology support service assignments during the same period.
Centres of Excellence promote technological advancement
Centres of Excellence have been established to strengthen research, advance existing technologies and develop new industrial applications.
Eighteen such centres have collectively filed 85 patents, published more than 600 research papers and developed 105 new technologies and products, contributing to indigenous technological capabilities and industrial innovation.
Quality standards and workplace safety
The government has introduced regulatory measures to improve product quality, protect consumers and promote responsible manufacturing in the chemicals and petrochemicals sector.
As of August 2026, 37 Quality Control Orders (QCOs) were in force, making specified chemical and petrochemical standards mandatory for domestic manufacturers and importers.
These standards are prescribed by the Bureau of Indian Standards (BIS) to curb substandard products and imports.
The government has also launched a nationwide training programme under the Viksit Bharat@2047 Action Plan to improve workplace safety in Major Accident Hazardous (MAH) units.
The programme focuses on the safe handling of hazardous chemicals and reducing associated workplace risks. It aims to cover all 2,393 MAH units over five years.
Each training programme covers 100 participants from 50 MAH units, with two employees attending from each unit.
As of August 2026, 21 training programmes had been conducted nationwide, covering 1,376 industrial units and training 2,441 personnel.
The initiative aims to strengthen industrial preparedness and improve awareness of hazardous chemical management.
Towards an integrated and globally competitive industry
India’s chemicals and petrochemicals sector is undergoing expansion through investments in manufacturing infrastructure, specialised industrial parks, research and technological development.
Initiatives supporting skill development, quality standards and workplace safety are also contributing to the sector’s long-term growth.
With platforms such as India Chem 2026 facilitating international engagement and industry collaboration, these efforts aim to enhance domestic manufacturing, promote value addition and strengthen India’s position in global chemical markets.
-PIB
