Saudi Aramco Unit Sabic Backs India’s $178 Billion Chemicals Market

(Bloomberg) -- Saudi Basic Industries Corp. is seeking to play a bigger role in India as the nation’s net-zero target boosts solar power and electric vehicles, creating demand for specialty plastics and chemicals.

India’s $178 billion chemicals market is already the sixth-largest in the world and is set to expand further over the next few years as rising disposable incomes and changes in consumption patterns boost the use of cars to consumer goods, according to ratings agency ICRA. 

That’s prompting India’s biggest oil refiners and Sabic’s parent, Saudi Aramco, to invest billions of dollars in oil-to-chemicals projects in the country. Additionally, Prime Minister Narendra Modi’s pledge to reach net-zero by 2070 will speed up India’s transition to electric vehicles, boosting the use of plastics in batteries and charging infrastructure. 

Both charging stations and batteries “need sophisticated materials” and “we have the right materials” for both, Janardhanan Ramanujalu, Sabic’s vice president and regional head of South Asia, Australia and New Zealand, said in an interview.  

Building Ties

Sabic’s resins can reduce the weight of components from dashboards to tailgates by as much as 40%, which allows the vehicles to go further with a single charge. It’s also keen on supplying material for building floating solar plants -- an area that could see rising interest as acquiring land for solar parks becomes challenging.

“In the long run, these are the ways one has to be innovative to put a lower burden on the environment,” he said, adding that floating solar panels that cover dams and reservoirs will not only check evaporation losses in a water-starved nation, but also avoid land conflicts and preserve valuable resources. 

The Riyadh-based company supplies fertilizer chemicals such as di-ammonium phosphate to India and sources a range of chemicals from the country. It also sees the South Asian nation as a market for its other specialty fertilizer products and is open to forging joint ventures and partnerships with Indian enterprises. 

“It’s a big market opportunity and we will play this comprehensively, which means not just produce in India for India, we will take what is available here,” Ramanujalu said.

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