Various Segments of Chemicals in India

Sub-segments of Chemical Industry There are six segments of the Chemical Industry in India viz.
Basic Organic Chemicals, Speciality Chemicals, Chlor-alkali, Pesticides, Dyestuff and alcohol based
chemicals. Basic Organic Chemicals The major organic chemicals produced in India are methanol, acetic
acid, formaldehyde, pyridines, phenol, alkyl amines, ethyl acetate and acetic anhydride. Formaldehyde
and acetic acid are important methanol derivatives and are used in numerous industrial applications.
Phenol is an aromatic compound and derived from cumene, benzene and propylene derivatives. Alkyl
amines are used in the manufacture of surfactants. Pyridine derivatives are used in the manufacture of
pharmaceuticals. Ethyl acetate is the ester of ethanol and acetic acid and is manufactured for use as a
solvent. Acetic anhydride is widely used as a reagent. For this segment of chemical industry, the Natural
gas/ naphtha are mainly used as feedstock for the manufacture of these organic chemicals. Alcohol is
also an important feedstock for the industry, with sizable production of acetic acid and entire production
of ethyl acetate being based on alcohol. Global production of organic chemicals was around 400 million
tonnes during 2010-11. Major producers of organic chemicals are USA, Germany, U.K, Japan, China and
India. Methanol Methanol is a very versatile chemical primarily produced in India from natural gas and
naphtha.

Alternative routes for production of methanol are coal and petcoke. Coal and petcoke route is
however not yet commercialized. The two major end-use segments for methanol are chemical and
energy. In the chemical segment, methanol is used for production of formaldehyde, acetic acid, di-
methyl terephthalate (DMT) and a range of solvents. The consumption of methanol in the energy
segment is substantial as blending component for petrol and methyl tertiary butyl ether (MTBE), tertiary
amyl methyl ether (TAME) and di-methyl ether (DME). India is a large importer of methanol. Due to
insufficient domestic production, in FY09 the net import of methanol was 1.06 million tonnes i.e. more
than 4 times the domestic production of 0.24 million tonnes. Acetic Acid Acetic Acid is primarily used for
production of purified terephthalic acid (PTA), vinyl acetate monomer (VAM), acetic anhydride and
acetate esters, all of them being important polymers. In India, production of acetic acid is primarily
based on alcohol. Its demand has increased in 11th plan by 10% per annum mainly because of the PTA,
which is basic raw material for polyester and fiber. Acetic acid is primarily produced through alcohol or
methanol route. Alcohol route in Indian context is gradually becoming unviable due to high prices and
limited availability of this feedstock.
 At present bulk of acetic acid is imported with domestic production accounting for less than 30%
of demand. Speciality Chemicals Specialty chemicals are the relatively high value, low volume chemicals
known for their end use applications and/ or performance enhancing properties.