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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.

Power Bill An Issue

Power Bill An Issue

India’s agriculture sector is heavily dependent on monsoons for natural irrigation. Pumps are used as an artificial means to provide water for farms and plants. Farmers rely on grid electricity or diesel gen-sets to run the pump, which leads to huge delays and economic stress. Hence, for our farmers, an effective irrigation system such as the Solar Water Pump is a great boon. It increases their crop yield by ensuring a reliable and perennial supply of water to their fields. To overcome all the hurdles and combat the pollution, the Maharashtra government took the decision to replace diesel pumps with solar pumps.


After the lengthy discussions, the state government decided to go ahead with this new scheme. The proper strategy was worked out that will also reduce the subsidy burden on electricity bills. The Maharashtra government will distribute 25,000 sun pumps in the first phase of the Atal Solar Agriculture Pump Scheme, 50,000 solar pumps in the second phase, and 25,000 solar pumps in the third phase to farmers to meet their irrigation demands. The state government has set a target to distribute a total of 1,00,000 pumps to farmers over the two years. This initiative aims to provide sustainable energy solutions and promote environmentally friendly farming practices. A solar water pump is an application of photovoltaic technology which converts solar energy into electricity to run the pumping system thereby, replacing erratic grid supply and pollution-causing diesel-powered versions. The solar water pump is powered by solar modules that help draw surface or groundwater out for irrigation.


The Maharashtra Solar Pump Yojana offers various benefits to eligible farmers. Approved applicants will receive a subsidy for solar water pumps, enabling them to utilize renewable energy for irrigation. The scheme details the eligibility criteria which requires certain documents, and the step-by-step process to apply online. This will benefit the farmers as well as the other electricity consumers in many ways like day time power availability for agriculture pumping, decoupling the irrigation sector from power subsidy burden, minimizing cross subsidy burden on Commercial & Industrial electricity consumers, replacement of diesel pumps to reduce pollution.


Farmers having farmland with assured sources of water are eligible. However, the farmers having conventional Electricity connection shall not get the benefit of Solar AG Pump from this scheme. Farmers from areas which are not electrified through conventional sources of energy (by MSEDCL) will get the benefit of this scheme.


Farmers from Remote & Tribal areas can also participate in this scheme. The government has aimed to provide solar water pumps on subsidy basis for agriculture in the state. The government has a vision for ensuring that farmers get water for agriculture even when power is not present in the areas. Solar Pump Kusum Yojana is the much-hyped scheme of the government of Maharashtra.

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