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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.

The Silent Weapon: Post-Pahalgam, Science May Redefine India’s Strategic Power

The suspension of the Indus Waters Treaty marks a turning point where hydrological mastery is fast becoming India’s most potent tool of deterrence.

On April 22, the serene meadows of Baisaran near Pahalgam, Kashmir, were shattered by a brutal terrorist attack. Twenty-six innocent lives were lost. In the wake of this tragedy, diplomatic relations between India and Pakistan rapidly deteriorated, culminating in the suspension of the Indus Waters Treaty - one of the most enduring frameworks of water-sharing in modern history. Beyond the immediate political consequences, this move opens a new chapter where science, not arms, may redefine strategic strength.


Signed in 1960 under World Bank auspices, the Indus Waters Treaty divided six rivers between India and Pakistan by allocating the eastern rivers (Ravi, Beas, Sutlej) to India and the western rivers (Indus, Jhelum, Chenab) to Pakistan— thereby enabling massive irrigation, hydropower and drinking water projects across both countries. The treaty also established a Permanent Indus Commission and procedures for conflict resolution, which remarkably withstood the pressures of wars in 1965, 1971, and 1999. Its suspension shifts the balance significantly, bringing scientific and hydrological management into sharp focus.


Water is not merely a resource but a critical factor of national security and resilience. Scientific studies show that even moderate variations in river flows can transform groundwater recharge rates, agricultural patterns, sediment movement, and hydroelectric generation. India’s upstream position on the Indus system grants it a profound advantage if leveraged carefully. Through modern hydrological modelling, satellite-monitored river flows, dynamic reservoir management and predictive seasonal assessments, India now possesses the scientific tools to recalibrate water availability without overt aggression.


Strategically, India can maximize the use of its share of waters through controlled seasonal diversions, storage during critical agricultural windows, and phased hydropower development. Such scientific precision allows India to boost internal water security by enhancing irrigation, energy production and urban water supplies while simultaneously applying calibrated pressure across the border.


Yet scientific responsibility must temper strategic ambition. Environmental science cautions that reckless manipulation of river systems can cause ecological imbalances in the form of disrupted sediment transport, wetland losses, and degradation of aquatic ecosystems. Therefore, India’s advantage lies not in indiscriminate control but in the intelligent, data-driven management of river flows. The use of cumulative impact assessments, ecosystem-sensitive flow adjustments and real-time hydrological monitoring will ensure that India strengthens its position sustainably. Long-term resilience depends not just on asserting upstream power, but on preserving the ecological health of shared river basins. In doing so, India can position itself not only as a strategic actor but as a responsible environmental steward in a region where water will define future stability.


At this point, it is vital to reflect on the paradoxical role of science itself. Throughout history, science has been both a casualty and a remedy during times of conflict. Wars have redirected scientific talent toward the creation of destructive power, yet the same scientific inquiry has offered humanity tools for resilience and reconstruction.


One of the most striking examples of this duality emerged during World War II. The Manhattan Project marshalled some of the greatest scientific minds to develop the atomic bomb, an unparalleled instrument of destruction. Yet it was the very same scientific spirit that later unlocked nuclear medicine, providing life-saving treatments for cancer and driving advances in medical imaging. Similarly, during the same period, radar technology, originally developed for military detection, evolved into civilian air navigation systems and disaster warning technologies that today save countless lives.


The story of Fritz Haber offers another profound lesson. Haber, a Nobel laureate, revolutionized agriculture through the Haber-Bosch process, enabling the mass production of fertilizers that feed billions. Yet he also pioneered chemical weapons during World War I, leaving a dark legacy that still haunts the ethics of science in conflict.


These historical examples serve as reminders that while science empowers nations with strategic leverage, it binds them to the ethical responsibility of foresight and stewardship. The same hydrological models and engineering feats that can strengthen India’s hand today must also be guided by wisdom, ensuring that future generations inherit rivers that sustain, not landscapes that suffer.


The suspension of the Indus Waters Treaty thus highlights a deeper scientific reality: in an era where wars are increasingly fought through influence rather than arms, mastery over natural resources becomes a silent but decisive weapon. Command over water, grounded in hydrological expertise and ecological sensitivity, offers India a new kind of deterrence which is subtle, powerful and rooted in legitimacy.


As we remember the innocent lives lost in Pahalgam, we must recognize that the future will be shaped not only by soldiers and diplomats but by scientists. It is through the intelligent stewardship of existential resources like water that nations will defend their dignity and secure peace in a turbulent world.


(The author is the former Director, Agharkar Research Institute, Pune and Visiting Professor, IIT Bombay; He is the current Chair, Water Technology Initiative, DST, Government of India. Views are personal)

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