India to become next major player in petro-chem industry with $37 billion capex push: S&P
S&P Global Ratings in its new report has indicated that India is poised to become the next major player in the global petrochemicals industry, backed by a planned capital expenditure of $37 billion aimed at boosting self-sufficiency. It expects the shift toward self-sufficiency to support the country to meet domestic demand which is historically relied on imports. Further, India will stick with major investment plans to reduce import dependency on chemicals used in everyday goods, from plastic bags to auto parts.
Meanwhile, it has warned that India's aggressive capacity expansion - following similar moves by China - will intensify oversupply pressures in Asia's petrochemical sector. It said that the shift could hurt regional exporters, as over 50% of India and China's chemical imports currently originate in Asia. It noted that options for Asian exporters are limited after US exports has been constrained owed to tariffs.
Despite overcapacity, it highlighted that India's robust domestic demand - especially for key products like polyethylene - is expected to support local producers' earnings, even as global players face pricing pressure and potential consolidation. It also expects India to overtake the US as the world's second-largest consumer of polyethylene.
