top of page

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.

The engineer nobody touched

An inquiry into Pune’s civic works lifts the veil on a sprawling nexus and a familiar political silence

Pune: The Supreme Court’s directive to the Anti-Corruption Bureau (ACB) to investigate the assets of a retired City Engineer from the Pune Municipal Corporation has sent shockwaves through the city. For the residents of Pune, the inner workings of the Construction Department and the illicit gains amassed by some of its shrewd officials are nothing new; however, this investigation has thrust the department and the corruption within it into the public spotlight.


Illicit Wealth

Social activist Tanaji Gambhire has alleged that the retired City Engineer, Prashant Waghmare, has amassed wealth amounting to a staggering Rs. 2,000 crore. When the municipal administration repeatedly failed to act despite numerous complaints regarding Waghmare’s alleged corruption, Gambhire finally knocked on the doors of the judiciary. The Supreme Court admitted Gambhire’s complaint and issued orders to investigate Waghmare’s disproportionate assets. Waghmare served as the City Engineer at the Pune Municipal Corporation from 2003 to 2026.


This marks the first instance in which the assets of the Municipal Corporation’s City Engineer are being subjected to a formal investigation. Social activists will be closely watching to see just how seriously the State Government pursues this inquiry. The reason for this scrutiny lies in the fact that Prashant Waghmare reportedly maintains "friendly" ties with "all" political leaders across the spectrum. Not a single corporator has ever forcefully exposed or scrutinized his conduct during the Municipal Corporation's general body meetings. Such was his clout that it was commonly whispered within municipal circles: “If Waghmare is involved, anything is possible,” and “No one can touch Waghmare.” Despite the Supreme Court delivering a decisive verdict regarding this Rs. 2,000 crore scandal, political leaders have maintained a conspicuous silence - a fact that has left social activists astonished.


Familiar Saga

For the city’s residents, the Municipal Corporation’s Construction Department and the irregularities plaguing it, is a familiar saga. The traffic crisis in Pune has reached a critical stage, and the corruption within the Construction Department of the Municipal Corporation is largely to blame. In the construction of most buildings, insufficient space is allocated for parking. Furthermore, builders often fail to make adequate arrangements for drinking water supply. Flat buyers are frequently left bewildered by revised building plans. Customers purchase flats under the mistaken assumption that the mere fact that a building has been erected implies its legality.


Consequently, the city's traffic infrastructure collapses. Municipal officials convey their 'messages' to builders through architects; the cost of these illicit transactions is ultimately passed on to the customer. This practice has persisted for years. It is, however, equally true that not all architects are involved in these corrupt dealings.


Pune is a major metropolis. Over the past two decades, the construction sector has boomed. The industry generates a turnover running into crores of rupees annually; the beneficiaries of this massive financial activity are not limited solely to officials within the municipal administration. Rather, a vast network comprising of certain police officers, revenue department officials, and criminal gangs is deeply entrenched in this system. There is open discussion throughout Pune regarding how certain officials within the Construction Department have acquired properties in the names of their wives or sisters. Builders frequently make donations to public institutions, thereby cementing their influence and position within the city.


Historically, rampant corruption plagued the Octroi Department within municipal corporations. With the abolition of the Octroi tax, the construction sector emerged as the new fertile ground for illicit gains. Some time ago, a controversy erupted regarding the construction of a building for a certain organization; even religious leaders joined the ensuing protests. During that episode, the name of a prominent political leader surfaced, sparking rumours of a nexus between the builder and the politician in question. Currently, the names of various political leaders are being linked to several ongoing construction projects across the city. For instance, a post office located in the city center was relocated to make way for a new construction project; the builder involved now openly boasts with evident pride that he enlisted the assistance of a Union Minister to facilitate the shifting of that post office.


Residents of Pune hope that, at the very least following this incident, there will be an improvement in the functioning of the Construction Department and the Anti-Encroachment Department. Many homebuyers find themselves stuck in various construction schemes; there are complaints that while some have already paid for their flats, they have yet to receive possession of the respective units. The State Government must look into these grievances and take steps to resolve them. With high-rise buildings springing up across the city, due consideration must also be given to infrastructure, specifically roads, water supply and drainage systems while granting permissions for such structures. The Pune Municipal Corporation was once served by a City Engineer who famously declared, “As the City Engineer, my foremost priority is to ensure that the aesthetic beauty of the city remains uncompromised.” It would be fitting to at least honour and remember his vision.

Comments


bottom of page