Changes Seem Permanent and Competitive Environment for Chemicals Will Improve

The tightening of environmental standards in China, and the consequent closure of several units in the country presents a good opportunity for India's chemical industry, as the competitive environment for chemicals manufacturing in India will improve. The changes in China seem permanent, and it is unlikely things will return to the way it once was.

These were some of the observations made by Mr. Ashwin Shroff, Chairman & Managing Director, Excel Industries Ltd., while addressing members of the Indian Speciality Chemicals Manufacturers' Associa- tion (ISCMA) at their Annual Get-together organised in Mumbai on May 4, 2018.

According to Mr. Shroff, the business of speciality chemicals is knowledge-driven, and not capital-driven as the bulk and commodity chemicals businesses are. "The speciality chemicals industry is seen as a solution provider, not just a product seller, but like the broad chemical industry will also be shaped by global geopolitics," he observed.

'Changes in China seem permanent and competitive environment for chemicals will improve'

Cleaner chemistry

Cautioning the industry that it is viewed with suspicion by society, Mr. Shroff urged the industry to go greener, including by exploiting carbohydrates as feedstock, instead of hydrocarbons, and through the deployment of biological tools to carry out chemical transformations. "Regulations that the industry grapples with are here to stay and there is no wishing them away," he added. "Self-regulation is best and one way of achieving this is by complying with the codes of Responsible Care."

Mr. Shroff also urged the chemical industry to invest in innovation, warning that technical disruptions will happen in the industry at a very rapid pace. "Electrical vehicles, for instance, will pose many hallenges and opportunities for the chemical industry," he noted. Furthermore, he urged industry players to keep abreast of novel technologies, such as micro-reactor technologies, adding that this form of miniaturisation is already a reality in some parts of the industry. "The industry must innovate quickly, cost effectively, and collaboratively. Collaborations can be within a company, between companies, with customers, or between industry and academic institutions."

Dwelling on some of the challenges faced by his company in creating value (in the form of compost) out of municipal waste, Mr. Shroff noted that at last this business is turning into an opportunity. "There are other opportunities as well in valorising waste, including the manufacture of methanol from organic wastes," he noted, adding that India will do well to explore such opportunities.

'List on the BSE'

Mr. Ashish Chauhan, Managing Director & CEO, BSE, urged promoters of small and medium enterprises (SMEs) to create wealth for themselves and for shareholders by listing their companies in the stock exchange. "An entrepreneur is the only person, besides the Governor of the Reserve Bank of India, who can print his own money, by listing his company in a stock exchange," he quipped.

According to him, more than 245 SMEs are now listed on the BSE and every week a few more are being added to the list. "Listing enables the promoter to convert income into wealth, helps in succession planning, takeover other companies and competitors, and enables benchmarking against ones peers," he added.