The task force on the chemical industry has come out with its recommendations, which will be placed before the Centre, to boost exports and facilitate additional foreign direct investment in this sector. These recommendations are likely to be a part of the major policy decisions by the Centre.
As per the main highlight of the recommendations, the Indian chemical industry does not have economies of scale in order to cater to the domestic as well as overseas demand. Though there are a number of small scale manufacturing units in India, they are not economically viable to meet the increasing demands. In addition, the cost of energy, mainly power, is too much in India as compared with some neighbouring countries. The Centre must impose changes relating to reforms in order to bring down the cost of power and other resources to maintain the profitability of all chemical companies in the country. Domestic chemical industry should be open up for joint ventures and open to other measures as well to enhance its competitiveness.
