Indian petrochemical sector poised for 10% CAGR growth: UPES ON faculty

The Indian petrochemical sector offers a lot of opportunities for employment with the projections that it will grow at 9-10 per cent of CAGR in the next two years, says Rushali Pant, Assistant Professor, at the online wing of University of Petroleum and Energy Studies (UPES ON).

She said the draft proposal to develop Visakhapatnam-Kakinada Petroleum, Chemicals, and Petrochemicals Investment Region (PCPIR) in Andhra Pradesh will contribute immensely to the growth of the country. In an exclusive interview to Bizz Buzz, Rushali Pant said that with McKinsey & Company pegging the valuation of the Indian petrochemical segment to reach $350-$370 billion by 2040, all these numbers paint a very encouraging figure for the petrochemical sector and the growth is likely to benefit all stakeholders in the coming years.

UPES CCE has been rebranded as UPES ON, the online wing of India’s leading university-University of Petroleum and Energy Studies (UPES), Dehradun that offers industry-aligned courses in the fields of energy, engineering, management, computer science, law, design, and much more.

How do you see the future of the petrochemical sector in India?

The growth prospects of the petrochemical sector in India are extremely bright, encouraging, and forward-looking in nature. Given India imports around 80 per cent of its total crude requirement, the government is planning to increase investment in the sector to lessen this heavy reliance on imports. Accordingly, experts predict a range of opportunities to emerge in the petrochemical sector with the Indian government chalking out an ambitious plan to spur domestic production of crude in the coming years. In terms of statistics, the Indian petrochemical sector was ranked sixth globally with a total valuation of $190 billion by the end of 2022. Various reports suggest that the segment will grow at an enviable 9-10 per cent CAGR in the next 20 years with McKinsey & Company pegging the valuation of the Indian petrochemical segment to reach $350-$370 billion by 2040.

At present, what is the size of the industry and how do you see the growth prospects with focus being made on renewable energy?

The size of the petrochemical sector in India was valued at $190 billion in the year 2022. Despite increasing focus on renewable energy, the significant growth in domestic manufacturing, automobile industry, e-commerce, and consumer durables are likely to push demand for petrochemicals in the country. In addition, the renewed push on infrastructure creation, supply chain expansions, and digital transformations will bring an extra boost to the growth of the fossil-fuel sector in the country. In addition, the increasing margins in the downstream integration in the petrochemical sector are also likely to encourage many existing players to expand their operations while inspiring new ventures to explore the segment for enhanced growth and profitability.

There is a proposal in Andhra Pradesh, which has the second largest coastline in India after Gujarat, to develop PCPIR between the port cities of Visakhapatnam and Kakinada. How do you think it will if grounded change the industrial landscape of the State giving a big push to port-led development?

The draft proposal to develop Visakhapatnam-Kakinada as a PCPIR will definitely lend a major boost to the overall economic development of the region. Given the fact that the region has all the necessary ingredients to become a success story, the holistic push from both government and private players will ensure that the benefits of this development will reach across stakeholders including the public at large. In addition to providing a fillip to the regional income, the industrial zone is expected to offer significant benefits to the State as well as the national economy.

The Krishna-Godavari basin falling in Andhra Pradesh is said to be containing large oil reserves. How far is there progress in exploring it?

The Krishna-Godavari oil extraction project could play a crucially important role in meeting the crude requirements of India. The ambitious project started in 2016 and was completed in 2017 although the extraction of oil started only recently with four of the total twenty-six wells becoming operational. According to official sources, the production capacity of the basin will reach 45,000 barrels/day by May or June 2024, translating into 7 per cent of the country's total crude oil production. Going forward, the remaining wells will become operational in an incremental manner, thereby further boosting the total domestic oil production in India.

The Prime Minister has given a call for energy independence by 2047. What is the task ahead to switch over to electric vehicles to save crude imports by over 90 per cent equivalent to $240 billion by that period? There is also a call to slash industrial coal imports by 95 per cent by laying emphasis on the production of green hydrogen-based and electrified industrial production. What do you suggest to achieve these goals?

To achieve energy independence by 2047, the need to develop a holistic and all-encompassing ecosystem couldn’t be overemphasised. Electrification of mobility is an important step to reduce levels of crude import although to ensure a smooth transition to Electric Vehicles (EVs), a multi-pronged strategy has to be developed and adopted by the automobile industry.

In addition to the contribution of car manufacturers, the efforts to establish charging infrastructure, widening service networks, and battery swapping facilities have to be made with full intensity. As far as hydrogen as a fuel is concerned, it comes equipped with tremendous potential although the high cost of production, storage, and transportation are some of the critical challenges that the green fuel has to overcome to become a fuel of preferred choice.

To achieve the desired results of hydrogen-based and electrified industrialisation, the government should encourage research, inspire entrepreneurs, and promote ventures which are making meaningful contributions to the green energy sector.

Can you provide an overview of UPES ON and its mission?

Founded on the values of trust, innovation, and inclusivity, UPES ON has embarked on an ambitious mission to change the face of the online educational landscape for working executives. The focus of our programs is to equip professionals with the necessary skills to handle fast-changing business realities. Our unwavering commitment to experiential learning coupled with new-age facilities and resourceful faculty is playing a crucial role in fulfilling the competence gaps that businesses across industries are today contending with. In sum, UPES ON is changing the face of online executive education and by equipping professionals with innovative skills and competencies, we are playing an important role in changing the fortunes of industries across product categories and service domains.

What sets UPES ON apart from other universities in terms of its programs and offerings?

UPES ON programs offer a unique blend of conceptual knowledge and experiential learning that is well complemented by the technology-first approach of its curriculum. The integration of new-age technologies in the curriculum encourages and inspires executives to embrace innovations to become future-ready. The robust learning framework that we at UPES ON have developed over years of comprehensive research is another facet that sets us apart.

The framework maps the skill gaps of executives and recommends relevant courses that help them meet the specific requirements of their work environment. The accreditations from prestigious national and international agencies including QS, IACBE, and WES also make us the leading organisation offering executive programs of global repute.

How does UPES ON stay current with industry trends and ensure that its programs are relevant?

Our constant and wide-ranging interactions with stakeholders across different industries help us remain up to speed with the latest and evolving business trends. We also hold regular deliberations with the policymakers on how to make our education system competitive on the global horizon. In addition, the regular exchange of information with both national and international accreditation agencies also helps us constantly evolve our curriculum, teaching methodologies, and learning frameworks among others.

How does UPES ON support students in terms of career development and job placement?

UPES ON offers comprehensive career support services that help aspirants get their dream job. Through its industry internship opportunities and live projects, we continue to remain at the forefront of offering attractive placement opportunities to students. Aspirants can also benefit from networking and collaborative opportunities by connecting with the large alumni network of the university. In addition, we offer executives discounted fee structures to access additional programs of the University besides offering them access to a digital library along with webinars, industry seminars, symposiums etc.

Do you find any shortage of high-end professionals in the petroleum sector? In which areas, there is a wide scope for value addition to ensure good career progression?

The growing demand in the oil and gas industry has led to an acute shortage of skilled manpower in the industry. According to McKinsey & Company, the sector has to fulfil the demand of around 1.9 skilled manpower by 2025. Further compounding the need for a skilled workforce is the large number of millennials which constitutes about 1/3rd of the existing workforce in the industry and will go on to make up 41 per cent of the manpower by 2025. As this cohort ages further, the need to replace them with young blood will come across as a major challenge for the sector. Given the focus on increasing the contribution of renewable energy worldwide, a large number of opportunities are likely to be manifest in the fields of decarbonised energy, natural gas, carbon credits, and energy storage. Accordingly, professionals skilled in information technology, marketing management, and supply chain will remain in high demand. In addition, the demand for executives skilled in developing, implementing, and controlling digital transformations will also increase in the near future.

How does UPES ON contribute to sustainable development and environmental conservation efforts?

By integrating digital technologies into our functional procedures and operational mechanisms, UPES ON has been able to contribute significantly to the cause of sustainability and environmental conservation. We have been working with faculty, students, staff, and other stakeholders to review our carbon footprints and align our practices with sustainable development goals (SDGs). The use of renewable energy, emphasis on the 3R approach, and encouraging circular economy are integral parts of our environment-conscious work practices. We are also proud of our biodiversity conservation plan which coupled with our efforts to promote social equity are making the planet a better place for our current as well as future generations.