Chemical companies need to spend on improving environment and safety: Yogesh Kothari, ICC

Like every year, Indian Chemical Council (ICC) is organising the Annual India Chemical Industry Outlook Conference from March 6-7, 2014. This year’s event will bring together a pool of experts from the industry to debate on ‘India in the global chemical industry’. The policy makers, the leaders from the industry and other important stake holders will collaborate on the huge potential which is apparent.
 
On the eve of this mega event, Rakesh Rao caught up with Yogesh Kothari, President, ICC, to known the present status of the Indian chemical industry and challenges and opportunities before it.
 
What are the challenges faced by the Indian chemical industry? How can one overcome these challenges?
The attitude and the awareness of the top management in the chemical companies need to go through a major change and bring their houses in order by spending capex towards environmental and safety related improvement projects. These need to be taken up may be in a phased manner but on a priority basis and for this finance may be provided by the Government looking at the overall potential of the industries and the revenues which can be generated which in turn helps overall growth of the GDP.
 
The image of the industry is always challenged and this is true all around the world - may be a little more so in India. The industry will have to realise the payback will be much more, when the house is in order.
 
The Government and the industries need to work out together to improve the glitches in the infrastructure facilities whether be the roads, industrial areas, port facilities, energy etc.
 
Is the slow economic development impacting the industry?
Of course, the chemical industry is dependent on the growth of other industries and the general economic development in the country. Different segments of the chemical industry get affected differently. However to the best of my understanding a large number of chemical companies are performing reasonably well. Some of this could be because of their export growth because of the weaker Rupee.
 
Some experts believe inverted duty structure is hurting the industry? What is ICC’s view on this?
The inverted duty structure wherever is happening hurts some segment of the industry. ICC is taking up with the government in neutralising it and whenever possible is convincing the Government to bring about neutrality.
 
Is Responsible Care initiative gaining greater acceptance among the Indian chemical manufacturers? What kind of support is ICC looking for from the Government to promote Responsible Care in the country?
Responsible Care is definitely gaining greater acceptance than what it was earlier. However it is not enough. ICC is trying to do its best to increase the awareness both with the members and the others in the chemical industry.The CEO of the chemical companies have to take it up on themselves to take this initiative which is voluntary in nature. Even if a cost/benefit analysis is taken up over a number of years the Responsible Care implementation would turn out to be a winner.
 
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The Government of Gujarat is already given positive signals for Responsible Care initiative in Gujarat by giving special concessions to the companies who have certified Responsible Care logos.
 
We at ICC are propagating the importance of Responsible Care and we want to take it up with various leading states such as Maharashtra, Tamil Nadu, Karnataka, etc. This is a win-win situation for everyone - the state, chemical companies and the society at large.
 
The Ministry of Chemicals & Petrochemicals is aware of the importance of Responsible Care and they are giving due recognition to it in its policies.
 
Are you seeing an increase in interest from the global chemical companies in India in the recent times?
Interest from the global chemical companies in India has always been there and once the overall situation in the improvement of infrastructure and its implementation is done, interest will be translated into more investments in the country. India is a big and a growing market. The money spent on consumer white goods, housing, better water treatment, healthcare, beauty products, all need chemicals.
 
Which are the areas/segments (within chemical industry) where India can play a big role on a global scale?
Many global chemical companies view India as an additional investment destination along with China to take the overall growth potential here and the surrounding countries. The talent pool of chemical engineers, chemists make it attractive for global companies to plan for projects needing multistep processes, intermediate chemicals which can be produced where the energy requirements are reasonable and raw material sourcing can be done locally or through imports. The global companies can adopt their technologies/licenses here with confidence of preserving the IPR.
 
What is your outlook for Indian chemical industry for 2014 & beyond?
I am very positive on our chemical industry with a rider that once we as the industry leaders appreciate the importance of SHE & Responsible Care, then the industry is bound to grow at a rate of 8 to 10% in the coming years and will contribute significantly to India’s growth.