Chemical industries form the fourth largest group of industries in the country after textiles, iron and steel and engineering industries. These together contribute more than 40 per cent of the total industrial production of the country. India is the tenth largest producer of chemicals in the world besides occupying the leading position amongst the developing countries. The industry plays a vital role in the nation’s economy.
It supplies raw materials to several industries like iron and steel, textiles, paper, synthetic fibers, rubber, plastics, paints, soaps, detergents, fertilizers, pharmaceuticals, pesticides and dyestuffs. Presently there are more than 700 units producing chemicals and allied products which account for a total investment of over Rs. 4,000 crores and providing employment to over 2.5 lakh persons.
Chemicals are of two types: (i) heavy chemicals, and (ii) fine chemicals. Heavy chemicals are generally produced in large quantities, usually at low cost, to make a number of consumer products and raw materials for the industries. Their growth is reckoned as the barometer of industrial development. Soda ash, caustic soda and sulphuric acid are traditionally categorised as heavy chemicals. Fine chemicals generally refer to dyestuffs, pharmaceutical and photographic chemicals and a large variety of products used in analytical and research work.
These represent expensive chemicals of a high degree of purity made for specialised uses and compared with heavy chemicals, their number is legion.
The beginning of the Indian chemical industry may be traced back to 1901 when a pharmaceutical plant was established near Kolkata. Since then there has been steady progress in the development of the industry. The annual turnover of the industry has reached Rs. 900 billion in 1996-97 which is likely to cross Rs. 1,000 billion marks by 2,000.
The industry contributes about 10 per cent of the total value of the country’s export besides sharing 20 per cent of customs and excise duties. The country has recorded a rapid growth in the manufacture of chemicals during the last few years. The estimated production of basic organic and inorganic chemicals amounted to 5 million MT in 1996-97. Similarly the production of dyes and pigment in the organised sector was over 37,000 MT during the same period.