question, "China is adding 3 World
scale plants with a total annual capacity of 11,00,000 TPA, more
than India's total annual PVC production. Do you think Chinese are
less prudent than Indians?"
China is planning to build world scale capacities
of PVC because their manufacturing capacity is about 2.5 million
tonnes compared to their consumption of about 4.7 million tonnes
China at present is importing more than 2 million
tonnes of PVC every year. The new capacity of 1.1 million tonnes
among 3 World scale plants of about 350-400kt/plant would only partly
fulfill its requirements. China is far ahead in consumption of all
polymers compared to India.
In our opinion, India will require atleast 30 years to catch up
with China in plastics consumption. This is despite our expected
growth of about 12-14% compared to 8% of China, because the present
difference in consumption is very significant.
A Simple illustration given below explains the basic premise:
||2001 consumption Mill. tonnes
These calculations are based on the following projected
average growth rates in the coming decades:
The time horizon could be even longer if China
continues to have better growth compared to the above projections.
PVC consumption in India after reaching up to almost
735-740 kt in 1998-1999 stagnated between 680-700kt in the last
2 years. While the global consumption has almost remained stagnant
at about 25 million tonnes, Indian PVC consumption in 2001-2002
is expected to grow to almost 760-780kt. All the developed economies
like that of North America, Europe and Japan had a negative growth
in 2001. China, India and some other Asian countries have grown
There is a strong need to build additional capacity in India since
the present capacity of 788kt is almost in balance with the demand.
The present economic size of a World Scale plant is 400kt, which
is almost 50% of the present consumption in India.
It therefore requires careful economic consideration
to set up a new World Scale PVC capacity in India.