The chemical industry is intricately connected with people's lives, whether drugs/medicines, thermoplastic furniture, cleaning agents, or synthetic garments.
FREMONT, CA: The Chemical Industry is among the world's big industries, worth a few trillion dollars, with millions of workers. The chemical industry is intricately connected with people's lives, whether drugs/medicines, thermoplastic furniture, cleaning agents, or synthetic garments. All of these are direct or devious products of the chemical industry.
There are many opportunities in the chemical industry, and simultaneously, many challenges impact its growth. The possibilities and challenges in the chemical industry will be discussed in further sections.
Opportunities In The Chemical Industry
1. REVERSE SPECIAL ECONOMIC ZONES
Special Economic Zones(SEZs) concentrate on exports, whereas reverse special economic zones or SEZs concentrate on imports. Setting up reverse SEZs external to a country would allow that country to import low-cost duty-free raw materials.
2. EXPORT IN EMERGING MARKETS
There is a great possibility for different chemical companies to capitalize on, irrespective of small or big, with rising markets like the Middle East, Asia-Pacific, and Africa. These countries are developing much faster than the Avant nations of Europe and North America, paving the way for export opportunities.
3. VARIANT FUEL UTILIZATION
A region with ample alternative fuel, like coal, can help expand its chemical and petrochemical production. There is an evolution in demand for petrochemicals, which can be eased by utilizing coal gasification technology to induce more chemicals and petrochemicals. This would give a good opportunity to fulfill the rising demand, which was before being satisfied by expanded imports.
Difficulties Faced By Chemical Companies
1. HIGH TAXES AND REGULATORY Issues
With the growing cost of raw materials, the tax levied on raw materials is greater than on finished products. This impedes numerous chemical companies from manufacturing more chemicals because of the high cost of raw materials and compels them to import the same chemicals with much lesser taxes collected on them.
Additionally, the regulatory processes are complicated, involving licenses and certifications for establishing chemical industries.
2. REMOTE LOCATION AND INSUFFICIENT INFRASTRUCTURE
The space between the location of the chemical industry and the demand area for the chemicals influences logistical transportation costs. Growth in the distance between the industry and the demand area would raise the overall expense of chemicals.
The industry confronts many infrastructural issues, like poor pipeline connectivity, indelicate railway depots, and inadequate power supply. These make it hard for the chemical industries to obtain raw materials from numerous suppliers.
3. LACK OF FEEDSTOCK
Feedstock or raw materials like natural gas utilized in the organic and inorganic chemical sectors are not readily procurable in the market. A deficiency of feedstock in an area would make the chemical businesses uncompetitive at the global level in the chemical industry. In contrast, regions with low-cost feedstock would hold a monopoly over the global chemical sector for that niche.
