In a push to become a manufacturing hub, the Indian government is considering Production Linked Incentive (PLI) schemes for domestic manufacturing of chemicals and petrochemicals, MoneyControl reported on Thursday.
“We are in favour of having India becoming a manufacturing hub and, of course, we’ll consider the PLI also for chemicals and petrochemicals,” Indian Finance Minister Nirmala Sitharaman said at the global chemicals and petrochemicals summit.
The finance minister also emphasised the importance of increasing domestic production to balance out the trade imbalance in the petrochemical and chemical industries.
In 2022–2023, India’s combined exports of chemicals and petrochemicals were valued at roughly $9 billion, while imports of similar products were valued at $13.33 billion, resulting in a trade deficit of more than $4 billion.
The PLI scheme was introduced in April 2020 to assist manufacturing in a few chosen industries. Under the scheme, the government provides businesses with incentives based on additional sales of goods produced domestically. It aims to reduce India’s reliance on imports and strengthen its industrial capacity.
With a $26 billion incentive outlay, the benefits of this scheme have already expanded to 14 sectors. Among the important industries that have received benefits under the PLI plan are telecommunications, electronics, white goods, textiles, and pharmaceuticals.
Sitharaman pushes for sustainability
Sitharaman also spoke about the rising sustainability concerns in the chemicals and petrochemicals industry regarding, carbon emissions, general pollution, and groundwater contamination.
“We should remember that India has set its sights on becoming energy independent by 2047 and achieving net zero [carbon emissions] by 2070,” MoneyControl quoted her as saying.
Sitharaman said that achieving net zero emissions will require efforts from every industry, including petrochemicals and chemicals. She claimed that India is highly motivated to promote green growth and lower carbon intensity.
She advised the industry not to rely on fossil fuels for their upcoming projects as India is expected to add 500 Giga-Watts (GW) of non-fossil energy generation capacity.
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