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Coronavirus impact: Chemicals and petrochemicals industry seeks 'essential' status, lockdown relief

PB Jayakumar     April 13, 2020

  • Chemicals and petrochemicals industry demands lift of lockdown
  • Seeks 'essential' status as it supply raw material for many essential goods
  • Sector faces dumping from other countries  
  • Plastic downstream industry should be treated as essential
  • Not easy to start and stop chemical and petrochemical plant processes

India's chemical and petrochemical (C&PC) industry has urged central government to declare the entire value chain in the sector as 'essential' during the coronavirus lockdown period. The industry claimed that it has multiple cross-linkages and is critical in functioning of many essential goods like food, edible oils, drugs, fertilizers etc.

According to Indian Chemical Council (ICC), many essential supplies from the C&PC sector are stuck at various checkpoints in the country. Manufacturers are unable to produce, even if permitted to operate, as their employees are finding it difficult to reach at work. Hence, the C&PC sector should be declared as essential and be exempted from lockdown, it demanded.

The ICC said that many essential life-saving drugs cannot be manufactured without an uninterrupted supply of key chemicals. Citing an example, the council said that many companies, which supply key raw material for drug like paracetamol, are being forced to shut. "The key raw materials for manufacturing of paracetamol, an essential drug, include a large number of chemicals like benzene, sulphur, caustic, chlorine, hydrogen, nitric acid, sulphuric acid and acetic anhydride. Similarly, polymers made by the petrochemcal sector, have life-saving with applications in medical devices like catheters, blood transfusion pipes, blood bags, Personal Protection Equipment (PPE), etc.", said the ICC, demanding that the plastic downstream industry should also be treated as essential due to its vast application in agriculture, potable water, food, process-flow etc.

It noted that the chemical plants in China, Korea, Taiwan, Europe and the US are already operational, as these countries consider the industry as an essential sector.

Highlighting the operational issue of chemical plants, the ICC said they work in continuous processes, which means that plants cannot be easily stopped and started.  In most continuous processes, there is a certain minimum turndown ratio, i.e. the minimum percentage of rated capacity that a plant can operate which can vary from 50% to 80%, depending on the product, it said.

To ensure safe restart of the sector's operations, ICC has interacted with its peers in industry organisations like the CEFIC (Europe) and ACC (America), and has procured guidelines on safe operations. These guidelines include hygiene and sanitisation at the workplace, social distancing, and all other norms covering safe operations which are in line with the government's objectives of preventing the recurrence of any COVID-19 spread, said the Council.

The sector is also staring at dumping from other countries. While domestic demand in other countries has dropped sharply as also exports, the inventory is piling up. This poses a dumping danger for countries like India as export incentives provided by many countries will further add burden to the domestic industry.

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