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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.

Soundings in the Dark

From Gwadar to Mauritius, China’s ‘research’ ships are forcing a reckoning with India in the Indian Ocean.

Recently, satellite and AIS data revealed the familiar choreography of four Chinese ‘research’ ships - Lan Hai 101, Lan Hai 201, Shen Hai Yi Hao and Shi Yan 6 - fanning out across waters that India and its partners consider strategically intimate. While Beijing insisted these were benign scientific missions, the hardware bolted to their decks suggests otherwise.


The missions were in fact a slow, methodical mapping of the underwater battlespace around India’s maritime periphery. Seabed contours, salinity layers, thermal gradients and acoustic signatures are the currency of modern naval power. They guide submarines, shape anti-submarine warfare and refine missile-tracking algorithms. Whoever owns such data owns the advantage of invisibility.


Oceanographic Archive

Lan Hai 101 was tracked on November 28 heading towards Galle in Sri Lanka, a port that continues to host Chinese research vessels under replenishment arrangements. The waters near Sri Lanka sit astride India’s eastern naval approaches, already among the most closely monitored in Asia. Each port call thickens China’s growing oceanographic archive.


Lan Hai 201 has been engaged in repeated grid-like movements near Diego Garcia, the American military base that anchors the Western alliance’s Indian Ocean presence. Such patterns are the signature of detailed seabed mapping that are useful for academics, invaluable for submariners plotting stealthy routes beneath the thermocline.


Shen Hai Yi Hao, one of China’s crown jewels of underwater exploration, is equipped with a manned deep-sea submersible. Officially spotted west of Indonesia on November 24, its projected track pointed towards the central Indian Ocean. High-precision sampling and underwater inspection blur the line between science and submarine support with remarkable ease.


Meanwhile, Shi Yan 6 was seen steaming towards Port Louis, Mauritius. Ships of its class routinely collect magnetic, seismic and acoustic data - essential inputs not only for marine research but for future submarine deployments and anti-submarine modelling.


None of these vessels flies the colours of the People’s Liberation Army Navy. That distinction fools no one. India and other maritime powers now track Chinese survey ships with the same intensity they devote to warships.


The timing of the operation of these ships is a matter of concern. Their latest dispersal coincided with India’s issuance of a NOTAM declaring a vast no-fly zone of nearly 3,500 kilometres off the coast of Visakhapatnam, home to India’s Eastern Naval Command and its nuclear submarines. The airspace restriction bore the unmistakable signature of a long-range ballistic missile test, likely linked to the K-series sea-launched programme.


This is too familiar a coincidence. In the past, Chinese tracking vessels - from the Yuan Wang fleet to specialised survey ships - have loitered near Indian missile-test corridors with suspicious punctuality.


Undersea Dominance

China’s use of ‘scientific’ platforms for strategic maritime reconnaissance is not a novelty of the Xi Jinping era. As far back as the 1970s, under Mao, Beijing treated oceanography as an instrument of national power, laying the intellectual foundations for what would later become its undersea dominance strategy. The pattern became unmistakable after 2008, when Chinese survey ships began appearing regularly in the Bay of Bengal following India’s Agni missile tests. In 2014, the dual-use fiction collapsed entirely when a Chinese attack submarine docked in Colombo under the guise of an anti-piracy deployment - an episode that jolted New Delhi into recognising how seamlessly science, commerce and coercion now blend in China’s maritime statecraft.


Hambantota’s 99-year lease, Gwadar’s militarisation, Kyaukpyu’s deep-water access and the steady normalisation of Chinese port calls across the Indian Ocean have supplied Beijing with the logistical skeleton its survey fleet now flesh out with data. What satellites record today is merely the visible edge of an accumulation that has been under way for nearly two decades.


From Sri Lanka to Diego Garcia, from Mauritius to Southeast Asia’s maritime gateways, the four ships now sketch a quiet quadrilateral of Chinese presence in the Indian Ocean. Individually, each mission looks harmless. Collectively, they amount to an expanding hydrographic shadow around India’s neighbourhood.


What unsettles Indian planners most is the cumulative logic of these deployments. China is quite methodically constructing a living ‘oceanographic library’ of the Indian Ocean that will only grow richer with every so-called survey mission. From acoustic fingerprints of the seabed to temperature layers that bend sonar, this invisible data will outlast ships and outlive political thaws. The recent easing of tensions along the Line of Actual Control does little to dilute the hard reality at sea which is that maritime power is built in peacetime, not crisis.


Indian security agencies today treat Chinese ‘research’ missions as part of a broader pre-positioning strategy, tied to Beijing’s growing access to ports from Gwadar and Hambantota to Kyaukpyu and now, more tentatively, to footholds in Mauritius and the Maldives. Yet awareness is not the same as readiness. India’s submarine numbers remain thin, its construction timelines are slow and its undersea deterrent still a work in progress.


Sun Tzu warned that war is “a matter of life and death, a road either to safety or to ruin.” In the Indian Ocean today, that road is being quietly surveyed by Chinese ships that insist they are merely studying the sea. India would be wise to study them just as closely.

 

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


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