Kolkata: There is a big opportunity to invest in the chemicals sector in the country which can result is huge import substitution, Ashish Bharat Ram, SRF’s chairman and managing director have told the media. Bharat Ram has pegged the import substitution to the tune of $25-30 billion and has emphasized that these chemicals do not include hydrocarbons.
“As a $2-trillion economy, there are certain chemicals where it would not have made sense to put up capacity to compete with China. We would not be able to consume more than 20-30% of it… Today, as India has become a $4-trillion economy, India can look to invest in these plants as an import substitution opportunity, since we have now developed the scale to consume a majority of this output,” Bharat Ram was quoted as saying.
Imports even for basic products
Pointing out the extent of import of chemicals that take place in India, Bharat Ram said that a lot of chemical intermediates are imported from China which are used for such basic products as shampoos and soaps.
Bharat Ram also indicated that his company is active in this area. “Over the next 3-5 years, a lot of investments of ours will come in that arena,” he said rather tantalisingly. Incidentally, SRF is a big player in the chemicals business, where it has entered after starting out as a manufacturer of tyre cord.
Successful diversification into speciality chemicals
The SRF boss said that in 2005 as much as 70% of the company’s revenue came from technical textile (tyr cord) but now it has shrunk to about 15-18% share of the revenues. The focus of the company and its bread and butter is speciality chemicals. The company is a supplier of active ingredients/intermediates to companies such as Syngenta, Bayer Crop Sciences and BASF, which operate in the area of crop protection chemicals.
SRF is also a major supplier of refrigerant gases in the Indian market for the AC sector. The company has announced that it will do a tie-up with Chemours, which is a spinoff from DuPont.