With Centre hinting at incentivising, AP’s PCPIR project may finally take off
The new PCPIR policy is expected to attract an approximate combined investment of over Rs 34 lakh crore (USD 420 billion) pan India
image for illustrative purpose
Visakhapatnam: With the Centre hinting at incentivising the implementation of petroleum corridors, Andhra Pradesh Government expects that the long-awaited Visakhapatnam-Kakinada Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR) will finally take off.
The Centre has already announced the sanction of Rs 1,000 crore towards creation of infrastructure on a bulk drug park at Kakinada. The port city of Kakinada at present has an anchorage and deep water ports and another gateway port is under construction brightening the prospects for its emergence as a crude import hub and cluster for petroleum processing and refining units.
After the YSRCP formed the government, it scrapped the PCPIR Special Development Authority and formed PCPIR Urban Development Authority by bringing 97 villages and 10 mandals from the undivided Visakhapatnam and East Godavari districts under its jurisdiction in 2021. During their visit to Visakhapatnam, Union Ministers Sarbananda Sonowal, Nitin Gadkari and Dharmendra Pradhan had hinted at giving a fillip to investments in the petroleum corridor in the region.
HPCL has Visakh Refinery in the city, which is increasing its capacity from 8.33 million tonne to 15 million tonnes with an investment of Rs 26,264 crore. Both Visakhapatnam and Kakinada have chemical and fertilizer plants and LPG bottling plants.
A senior official from the State Industries Department told Bizz Buzz that the State Government is expecting to give a push to investments in the petroleum sector in the near future. The new PCPIR policy is expected to attract an approximate combined investment of over Rs 34 lakh crore (USD 420 billion) pan India.
Chemical market in the country is expected to reach $300 billion in the next few years from the present $178 billion. “We are expecting the coming decade to bring in investments worth more than USD 87 billion. India is expected to account for more than 10 per cent of the world’s growth in petrochemicals,” said Union Minister for Petroleum and Natural Gas Hardeep Singh Puri at a conference recently in New Delhi.
He said 25 per cent of the global energy demand growth in the next two decades is going to emanate out of India adding “the India petrochemical industry has come a long way from inception in the 1970s and is poised for transformational growth. It is expected to contribute almost 10 per cent to the incremental growth in the global petrochemical demand in the coming years.”
Dr Mansukh Mandaviya, Minister of State for Chemicals and Fertilizers said the government will unveil the revamped PCPIR policy mainly to reduce import-dependence. Growing demand for various chemicals and petroleum products and the domestic short-supply has led to increased dependence on imports. He said the PCPIR policy will promote multiple chemical hubs to meet specific industry needs as well as to make a dent in the export market.
As on today, the petrochemical industry has a stunted growth as Rajasthan has scrapped its PCPIR project whereas Barmer PCPIR is awaiting major investments. The Dahej project in Gujarat is encountering technical challenges and environmental concerns. He said the government wants policies in place to encourage investments in chemical and petroleum units.
India has increased its refining capacity from 215 MMTPA in 2013-14 to 251.2 MMTPA-the fourth largest in the world after the United States, China and Russia.
