chemical parks for 14 February 2026

Chemical Parks are specially designed industrial areas, where multiple chemical industries are set up together. They provide shared infrastructure, safety measures and environmental management and help to promote efficient and safe production. These parks boost industrial growth while reducing pollution and hazards.

Chemical Parks

Chemical Parks are industrial areas planned specifically for chemical and petrochemical industries. Many factories work together here, sharing world class modern facilities and common services to improve efficiency and safety.

Importance and Rationale of Chemical Parks in India

• India’s chemical industry has benefited from cluster-based models like Plastic Parks, Bulk Drug Parks and PCPIRs, which show advantages of shared infrastructure, anchor investments and coordinated planning.
• Proposed Chemical Parks target to cover the entire chemical value chain, including bulk, specialty and downstream chemicals.
• They provide operational industrial infrastructure, shared utilities, logistics support and easier regulatory approvals in one location.
• Expected benefits include:
  • Reduced project setup time and lower capital costs.
  • Better economies of scale and improved backward and forward integration.
  • Enhanced safety and environmental management through shared facilities.
  • Strengthened domestic and global competitiveness of India’s chemical sector.
• Combined with existing initiatives, Chemical Parks establish a clear framework for cluster-led industrial development in the chemical sector.
• Policy support, technology adoption and sustainability measures are expected to boost India’s manufacturing capabilities and global integration in chemical value chains over the next decade.

Chemical Industry of India

• The chemical industry is a major part of India’s manufacturing sector, supplying raw materials to agriculture, pharmaceuticals, textiles, automobiles and construction.
• It contributes around 7% to India’s GDP.
• India ranks 6th globally and 3rd in Asia in chemical production.
• The country produces over 80,000 chemical products, including bulk chemicals, specialty chemicals, agrochemicals, petrochemicals, polymers and fertilizers.
• Specialty chemicals are a strong segment due to India’s efficient processes, cost advantages and growing innovation capacity.
• The Economic Survey 2025-26 notes the chemical sector contributed 8.1% to manufacturing Gross Value Added in FY24.
• Production of major chemicals and petrochemicals increased from 45.6 million tonnes in FY16 to 58.6 million tonnes in FY25, with a compound annual growth rate (CAGR) of 2.8%.

Union Budget 2026-27

• Union Budget 2026–27 allocated ₹600 crore to help States set up three dedicated Chemical Parks.
• Parks will be cluster-based, plug-and-play manufacturing hubs with shared infrastructure and facilities.
• First, the government is giving specific budget support for chemical park infrastructure.
• Aims to boost domestic chemical production, strengthen supply chains and reduce import dependence.

Chemical Parks Significance

With government support and policies promoting new technology, innovation and environmentally friendly practices, Chemical Parks are expected to strengthen India’s manufacturing skills. They will help Indian chemical industries produce more efficiently, reduce costs and compete better internationally, while also connecting India more closely to global chemical trade and supply chains in the next ten years.

Challenges faced by India’s Chemical Industry and Parks

• India’s chemical industry heavily depends on imported raw materials, causing a trade deficit of around USD 31 billion in 2023, affecting self-reliance.
• Many industrial clusters have outdated infrastructure and high logistics costs make Indian products less competitive globally.
• The focus remains on bulk chemicals instead of high-value specialty chemicals, missing opportunities for higher profits and innovation.
• Investment in research and development is low, limiting technological advancement.
• Environmental compliance is complex, with long processing times, overlapping central and state regulations and strict norms like Zero Liquid Discharge, increasing operational costs.
• There is a significant shortage of skilled professionals, especially in niche areas such as green chemistry, nanotechnology and advanced process engineering.
• In chemical parks, high domestic feedstock costs (natural gas, naphtha) reduce competitiveness, while clustering hazardous units increases risks of accidents spreading (“domino effect”).
• Large clusters place pressure on local resources like water and power and securing large, contiguous land parcels with safety buffers is a major challenge.

Way Forward

• Safety & Disaster Management: Establish centralized safety and emergency response systems, with buffer zones and emergency plans.
• High-Value Chemicals: Focus on specialty chemicals instead of bulk products to boost global competitiveness.
• Green Technology: Promote clean energy and carbon capture to reduce pollution and support sustainability.
• Professional Management: Adopt a centralized management model to ensure proper maintenance of infrastructure, utilities and high safety standards.
• R&D & Innovation: Set up Centres of Excellence to encourage industry-academia collaboration and develop advanced chemicals.

Related Schemes by Government

The cluster schemes supported by the government to promote chemical Industries in India are discussed below:

The Plastic Parks scheme

• Plastic Parks scheme launched in 2013-14 by the Department of Chemicals & Petrochemicals.
• Special industrial zones for plastic businesses to boost production, investment, exports and jobs.
• The government provides up to 50% of project cost, max ₹40 crore per park.
• 13 Centres of Excellence set up in top institutes to promote plastic and polymer research.
• 10 Plastic Parks approved in various states.

Scheme for Promoting Bulk Drugs Parks

• The Promotion of Bulk Drug Parks scheme was launched in 2020 to make India self-reliant in bulk drug manufacturing.
• Aims to reduce manufacturing costs, fill infrastructure gaps and ensure a steady supply of high-quality drugs.
• Provides common facilities like effluent treatment, waste management, water, power, cooling, warehouses and logistics to support industries.
• Helps pharmaceutical companies meet environmental standards and scale up production efficiently.
• Three Bulk Drug Parks established in Gujarat, Himachal Pradesh, and Andhra Pradesh with ₹3,000 crore support.
• Supports advanced labs, emergency response, safety audits and Centres of Excellence for research and quality control.

Petroleum, Chemicals, and Petrochemical Investment Regions (PCPIRs)

• PCPIRs are special regions for chemical, petrochemical and petroleum industries, designed for both domestic production and exports.
• They combine factories, utilities, logistics, environmental systems and administration for coordinated industrial growth.
• Three PCPIRs are in Andhra Pradesh (Visakhapatnam), Gujarat (Dahej), and Odisha (Paradeep).
• Along with Plastic Parks and Bulk Drug Parks, PCPIRs promote cluster-based industrial development, shared infrastructure, cost efficiency and environmental compliance.
• As chemical production grows, strong environmental management and high safety standards are essential in these industrial clusters.