Page 104 - Tata_Chemicals_yearly-reports-2019-20

the Index of Industrial production (‘IIp’) registered a growth prioritising project governance according to Covid-19 affected
of 0.5% in april-december 2019, as compared to 4.7% during regions and leveraging business continuity planning are key to
april-december 2018. IIp of the manufacturing sector declined overcoming the situation.
by 1.2% in december 2019, as compared to a growth of 2.9% in
december 2018. Global Trend: uncertainty for the world, possibilities for India (as
per KpMg report on Indian Chemicals Industry, February 2020)
growth of bank credit was 7.1% (YoY basis) as on January 31, 2020, • Several global oil and gas majors are turning their sights
as compared to 14.5% in the corresponding fortnight end of the towards downstream chemical opportunities. this may
previous year. increase the focus on petrochemicals in India and higher
investment in the sector may ease feedstock challenges and
the Budget estimates of the fiscal deficit as percentage of gdp boost self-sufficiency.
for FY 2019-20 have been set at 3.3%, as compared to 3.4% in
FY 2018-19 (provisional actual or pa). • the structure of China’s chemical industry is changing due
to stricter environmental norms, tighter financing and
the rupee exchange rate (re/uS$) stood at 71.3138 at the end of consolidation, which could present opportunities for India’s
January 2020, compared to 71.2328 at the end of december 2019. chemical companies in certain value chains and segments,
especially in the short term.
India’s current account deficit (Cad) was 0.9% of gdp (uS$ 6.3
billion) in the second quarter of FY 2019-20 as compared to 2.9% • trade conflicts have erupted around the world, especially
gdp (uS$ 19 billion) in the second quarter of FY 2018-19. among China, the united States and Western europe. large
chemical markets that remain accessible in this scenario
external debt stood at uS$ 557.5 billion at end-September 2019, could present opportunities for chemical companies in India.
recording an increase of 0.5% over the level at end-June 2019.
long-term debt was uS$ 448.4 billion at end-September 2019, • Industry-wide, there seems to be a move towards prioritisation
of core businesses and consolidation on a greater scale, often
while the remaining uS$ 109.1 billion was short-term debt.
through big-ticket mergers and acquisitions. For companies
Sectoral Information in India, scale will matter even more, as it could help them to
fortify any other competitive advantage.
the Chemicals industry in India contributes 1.34% to the nation’s
gross Value added (Source: National Investment Promotion & • digital technology has established itself as a lever to enhance
Facilitation Agency) and is a highly diversified business, covering efficiency and productivity. Indian companies could tap into
more than 80,000 commercial products broadly classified into Bulk this opportunity to expand their profit margins.
Chemicals, Specialty Chemicals, agrochemicals, petrochemicals,
th
th
polymers and Fertilisers. India ranks 14 in export and 8 in • Chemical companies could prioritise environmental
import of chemicals (excluding pharmaceutical products) globally. sustainability to protect long-term shareholder value, while
the demand for chemical products is expected to grow at continuing to comply with local regulations.
approximately 9% per annum over the next 5 years.
Agriculture
Specialty Chemicals constitute 22% of total chemicals/ gross Value added (gVa) by agriculture, forestry and fishing
petrochemicals market in India. as of FY 2017-18, the total market is estimated at ` 18.55 lakh crore (uS$ 265.51 billion) in
size was around uS$ 35 billion. the demand for Specialty Chemicals FY 2018-19 as per the IBeF January 2020 report. according to the
is expected to grow at 12% Cagr during FY 2019-22. department for promotion of Industry and Internal trade (dpIIt),
the Indian food processing industry has cumulatively attracted FdI
Key sectors such as automobile faced a slowdown that rolled equity inflow of about uS$ 9.41 billion between april 2000 and
over from the previous year, as sales fell 13.83% YoY in January June 2019.
2020.
the union agriculture Ministry has asked the states to plan for
projects in the construction sector worth more than ` 59,000 a total foodgrain production of 298 million tonnes (149.92 Mt
billion are under development, but severely impacted by kharif plus 148.4 Mt rabi) for the crop year FY 2020-21, increasing
Covid-19. India’s goal of becoming a uS$ 5 trillion economy rests mainly the output of pulses and coarse cereals. there has also
on the completion of critical infrastructure under the national been an increase in targets for oilseeds and cotton to 36.64 million
Infrastructure plan. enhancing labour health, strengthening and tonnes (against the production estimate of 34.19 million tonnes in

102 I Integrated annual report 2019-20