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By:

Akhilesh Sinha

25 June 2025 at 2:53:54 pm

Nadda's strategic meet signals urgency for chemical sector

New Delhi: As war simmers across the volatile landscape of West Asia, whether in the form of a direct confrontation between Israel, United States and Iran, or through Iran's hybrid warfare involving groups like Hezbollah and the Houthis, the tremors are no longer confined to the region's borders. They are coursing through the arteries of the global economy. India's chemicals and petrochemicals sector, heavily dependent on this region for critical raw materials, finds itself among the earliest...

Nadda's strategic meet signals urgency for chemical sector

New Delhi: As war simmers across the volatile landscape of West Asia, whether in the form of a direct confrontation between Israel, United States and Iran, or through Iran's hybrid warfare involving groups like Hezbollah and the Houthis, the tremors are no longer confined to the region's borders. They are coursing through the arteries of the global economy. India's chemicals and petrochemicals sector, heavily dependent on this region for critical raw materials, finds itself among the earliest and hardest hit by this geopolitical turbulence. It is in this backdrop that the recent meeting convened by Union Minister for Chemicals and Fertilisers J. P. Nadda at Kartavya Bhavan must be seen not as a routine consultation, but as a signal of strategic urgency. India's ambition to scale this sector from its current valuation of $220 billion to $1 trillion by 2040, and further to $1.5 trillion by 2047, will remain aspirational unless the country confronts its structural vulnerabilities with clarity and resolve. India today ranks as the world's sixth-largest producer of chemicals and the third-largest in Asia. The sector contributes 6-7 percent to GDP and underpins a wide spectrum of industries, from agriculture and pharmaceuticals to automobiles, construction, and electronics. It would be no exaggeration to call it the backbone of modern industrial India. Yet, embedded within this strength is a paradox. India's share in the global chemical value chain (GVC) stands at a modest 3.5 percent. A trade deficit of $31 billion in 2023 underscores a deeper issue: while India produces at scale, it remains marginal in high-value segments. This imbalance becomes starkly visible when disruptions in West Asia choke the supply of key feedstocks, shaking the very foundations of domestic industry. Supply Disruption The current crisis has laid this fragility bare. Disruptions in the supply of LNG, LPG, and sulfur have led to production cuts of 30-50 percent in several segments. With nearly 65 percent of sulfur imports sourced from the Middle East, the ripple effects have extended beyond chemicals to fertilisers, plastics, textiles, and other downstream industries. Strategic chokepoints such as the Strait of Hormuz have witnessed disruptions, pushing shipping costs up by 20-30 percent and adding further strain to cost structures. This is precisely where Nadda's emphasis on supply chain diversification and resilience appears prescient. In today's world, self-reliance cannot mean isolation; it must translate into strategic flexibility. While India imports crude oil from as many as 41 countries, several critical inputs for the chemical industry remain concentrated in a handful of sources, arguably the sector's most significant vulnerability. Opportunity Ahead A recent report by NITI Aayog outlines a pathway to convert this vulnerability into opportunity. It envisions raising India's GVC share to 5-6 percent by 2030 and to 12 percent by 2040. If achieved, the sector could not only reach the $1 trillion mark but also generate over 700,000 jobs. However, this transformation will demand more than policy intent, it will require sustained investment and disciplined execution. The most pressing challenge lies in research and innovation. India currently spends just 0.7 percent of industry revenue on R&D, compared to a global average of 2.3 percent. This gap explains why the country remains largely confined to basic chemicals, even as the world moves toward specialty and high-value products. Bridging this divide is essential if India is to climb the value chain. Equally constraining is the fragmented nature of the industry. Dominated by MSMEs with limited access to capital and technology, the sector struggles to compete globally. Cluster-based development models offer a pragmatic way forward, such as PCPIRs and the proposed chemical parks.

Can India Unlock Peace in Ukraine?

Amid the wreckage of a cancelled U.S.-Russia summit, India’s quiet diplomacy could yet make it the world’s most plausible broker of peace in ending a grinding conflict.

The Budapest summit that was to be held last month was meant to be a moment of hope. The meeting between US President Donald Trump and Russia’s Vladimir Putin promised to make one more attempt at ending the devastating war in Ukraine. Instead, it became another casualty of distrust.


In the weeks before the scheduled meeting, Russia’s foreign ministry circulated a memo to Washington, restating its now-familiar demands: recognition of its territorial claims in Ukraine, and a binding assurance that Kyiv would never be allowed into NATO. Putin called these “basic conditions” for negotiation. The United States called them unacceptable and abruptly cancelled the summit after what officials described as a tense phone exchange between the two countries’ top diplomats.


The breakdown has reinforced an uncomfortable truth that the world’s two nuclear superpowers are not just unwilling, but perhaps incapable, of finding common ground. In the fallout, it is countries like India that find themselves uncomfortably caught between principles and partnerships.


Delicate balance

New Delhi has been walking a diplomatic tightrope for some time now. Its long-standing friendship with Moscow, rooted in Cold War camaraderie and defence cooperation, coexists with its deepening strategic partnership with Washington especially in the Indo-Pacific, where China’s rise looms large.


The cancellation of the Budapest summit exposes the limits of India’s balancing act. Yet it also highlights India’s potential. For all its failed attempts to forge a ceasefire or humanitarian corridor in Ukraine, India remains one of the few powers trusted—or at least tolerated—by both Russia and the West. That, in itself, is no small thing.


Since independence in 1947, India has practised a form of strategic non-alignment. The principle was simple: engage with all, align with none. In the 21st century, that doctrine has evolved into ‘multi-alignment’ - a more fluid, opportunistic form of engagement designed to preserve strategic autonomy amid great-power rivalry. The result is that India can talk to everyone, from Washington and Moscow to Beijing and Brussels, without the baggage of ideological allegiance.


This very flexibility makes India uniquely suited to act as a go-between. As the war in Ukraine drags into its fourth year, with the West’s fatigue growing and Russia’s resolve hardening, the world needs a credible interlocutor who can coax both sides toward compromise. India, unlike China or Turkey, fits that description.


India’s credentials are formidable. Its partnership with the United States has deepened dramatically over the past decade, accelerated by shared concerns over China’s assertiveness in the Indo-Pacific. Defence agreements, joint military exercises, and technology partnerships have multiplied since 2014.


Yet India has refused to join the Western sanctions regime against Russia, continuing to buy discounted Russian oil and arms, citing “national interest.”


Far from alienating Washington, this stance has been met with grudging respect. America recognises that India’s neutrality, however inconvenient, gives it access to Moscow in ways the West no longer enjoys. In private, several Western diplomats concede that if peace talks are ever to resume, they will likely pass through New Delhi.


There is also the matter of perception. India, unlike most major powers, commands moral legitimacy across the developing world. It is seen not as a hegemon or patron, but as a fellow traveller that speaks for the Global South. When Prime Minister Narendra Modi told Putin in 2022 that “today’s era is not an era of war,” it struck a chord across capitals weary of confrontation. It was a simple phrase, but it carried the weight of an alternative worldview that values dialogue over dominance.


Honest broker

That perspective aligns with the mood in much of Africa, Asia and Latin America. Many countries have quietly refused to take sides in the Ukraine conflict, opposing Western sanctions while also condemning Russia’s invasion. In United Nations votes, their ambivalence has been visible. India embodies that ambivalence in diplomatic form. It is precisely this balancing act that could make it an honest broker.


Other potential mediators have fallen short. China, despite its global influence, has disqualified itself by leaning too heavily towards Moscow. Indonesia and Israel have made sporadic attempts at diplomacy but lack the clout to sustain them. Turkey, though instrumental in brokering grain-export deals in 2022, remains a NATO member and its own president has accused the West of ‘provoking’ Russia. Vietnam, with ties to both Russia and the U.S., has chosen to remain studiously silent.


By contrast, India has kept its options open. It has neither condemned nor condoned Russia’s war, neither abandoned nor alienated the West. Its approach has been frustratingly cautious but also disarmingly consistent. In a geopolitical landscape where every player seems trapped by alliances, India’s flexibility is its strength.


For this potential to translate into influence, two conditions must be met. First, Washington must temper its impatience with India’s neutrality. If President Trump, never one for diplomatic nuance, truly wants a negotiated peace, he must resist the temptation to berate India for hedging its bets. His anti-India rhetoric will only serve only to squander two decades of bipartisan effort to strengthen ties between the world’s two largest democracies.


Second, New Delhi must seize the moment. It cannot be content merely to occupy the middle ground but must use that space to shape outcomes. By investing political capital in shuttle diplomacy, perhaps under the aegis of the G20 or BRICS, India can demonstrate that it is not just a bridge between East and West, but a power capable of solving problems that others cannot.


Such a role would enhance India’s global stature while providing a moral counterpoint to the cynicism that has come to define modern geopolitics. Peace is never achieved by those with the loudest guns but by those with the most credible voices. The world may not be ready to admit it, but the path to ending the Ukraine war may well run through New Delhi.


(The author is a retired Naval Aviation Officer and a defence and geopolitical analyst. Views personal.)

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