The government today announced its plans to set up petrochemical complexes around all 22 refineries across the country which would help generate one crore jobs and boost the sector's growth.
Union Minister Ananth Kumar asked the chemical industry "not to just rely on the government incentives but become competitive" while assuring companies of providing common facilities for those setting up brownfield clusters.
He called upon the industry to become "competitive" in feed stock, procurement of natural gas and production of end-products for doubling the sector's growth to USD 400 billion by 2021.
"The government has decided to establish petrochemical hubs in and around all 22 refineries," the minister for chemicals and fertilisers said addressing an event here.
The proposed petrochemical complexes would not just be confined to Gujarat, Maharashtra, Andhra Pradesh, Odisha and parts of Tamil Nadu, but would be set up in other states as well, he said.
Petrochemical companies and other downstream manufacturers catering pharma and plastics, need to be set up around refineries as this will help bring down the cost of logistics, he said.
The proposed plan, which is expected to attract huge investment and generate one crore jobs, will soon be discussed with Petroleum Minister Dharmendra Pradhan, he added.
The minister also said the industry should focus on 'cluster approach' for establishing both greenfield and brownfield petrochemical projects, and promised to provide common facilities for brownfield clusters to bring down the cost.
"The government is a facilitator. We are here to support you. Please don't just rely on incentives. That will be there. Become more competitive," he said.
Incentives give 'minor relief' to the industry but the major relief would come from becoming competitive in feed stock and other alternative sources of fuel.
"We are growing at 11-12 per cent. To achieve the target
of USD 400 billion by 2021, we should grow uniformly at 14.7 per cent every year," he said.
This high growth cannot be achieved unless the cost of natural gas is brought down to USD 2-3 per mmbtu from the current rate of USD 9-9.5 per mmbtu and feed stock is assured to intermediary industries for processing of raw materials used for making products like plastic, he added.
Kumar said the country does not have sufficient natural gas and is looking for affordable sources including coal-gasification as he called the industry to come up with a whitepaper on coal-gasification.
He also ruled out privatisation of Kochi-based fertiliser company FACT, saying the government has provided Rs 1,000 crore credit line for its revival.
"It is a public sector undertaking and there will be no privatisation of FACT. This year, I am told they will achieve the target of 1 million tonnes production," he said.
Chemical and Petrochemical Secretary Anuj Kumar Bishnoi said the government is in the process of finalising the national chemical policy which will help boost investment.
At present, there are "fragmented" investments, he noted, and urged the industry to actively involve in raising the capacities keeping in view the growth potential.
