The specialty chemicals industry plays a vital role in modern manufacturing, supplying essential product ingredients across various sectors such as agriculture, pharmaceuticals, textiles, and personal care. With increasing awareness of climate change and environmental degradation, sustainable practices in specialty chemical manufacturing are becoming a crucial focus worldwide. In India, which ranks among the fastest-growing markets for specialty chemicals, adopting green practices is a regulatory necessity and a strategic move to ensure long-term growth and global competitiveness.
The need for green practices
India's specialty chemicals market has been experiencing steady growth, with an estimated value of USD 32 billion in 2023, projected to reach USD 65 billion by 2028. This rapid expansion has come with significant environmental concerns. The industry is associated with high energy consumption, waste generation, and water pollution, contributing to environmental challenges. The need for sustainable practices is underlined by India's commitment to reducing its carbon footprint as part of its Nationally Determined Contributions (NDCs) under the Paris Agreement, which aims to cut the country's emissions intensity by 45% by 2030, compared to 2005.
Green chemistry
Green chemistry is at the forefront of transforming the specialty chemicals industry towards sustainability by promoting the design of safer chemical products and processes. In India, companies increasingly invest in R&D to develop processes that utilise renewable raw materials and minimise toxic by-products. Bio-based chemicals from agricultural waste are gaining traction as alternatives to traditional petroleum-based feedstocks, reducing fossil fuel dependence and supporting a circular economy. A 2023 report by the Indian Institute of Chemical Technology suggests that adopting bio-based chemicals could cut the industry’s carbon emissions by up to 25% over the next decade, with government incentives under the PLI scheme further encouraging the shift to green technologies.
Energy efficiency and process optimisation
Energy-intensive processes like distillation and crystallisation are common in specialty chemical manufacturing. Companies are adopting process optimisation techniques to reduce energy consumption, including advanced process control (APC) and real-time data analytics. In addition to energy savings, green practices extend to heat recovery systems, where waste heat generated during chemical reactions is captured and reused. This not only decreases the overall energy footprint but also enhances operational efficiency. With India's electricity prices rising by nearly 8% annually, energy efficiency is not just a sustainable choice but an economic imperative.
Waste management and water conservation
India's speciality chemicals industry has historically faced waste management challenges, particularly hazardous waste disposal. To address this, companies are adopting Zero Liquid Discharge (ZLD) technologies, which recycle and reuse wastewater, leaving no effluent discharge. The implementation of ZLD, spurred by regulatory requirements from the Central Pollution Control Board, has significantly impacted regions like Gujarat and Maharashtra, where industrial water stress remains a concern.
Regulatory and market drivers
India’s regulatory landscape is gradually evolving to support sustainable practices in chemical manufacturing. The Environmental Protection Act, updated in 2023, introduced stringent penalties for non-compliance with waste management and emission standards, pushing companies to adopt greener practices. Additionally, global clients increasingly demand sustainable products, influencing Indian companies to certify their products with eco-labels and adhere to international standards such as REACH (Registration, Evaluation, Authorisation, and Restriction of Chemicals).
Adoption of digital solutions for sustainable operations
Integrating digital tools such as predictive maintenance and IoT-based monitoring is transforming the specialty chemical industry’s sustainability initiatives. By using predictive analytics, companies can anticipate equipment failures and reduce downtime, thus optimising resource use. A 2023 survey by the Confederation of Indian Industry (CII) found that over 60% of specialty chemical manufacturers in India have started adopting digital solutions to monitor emissions and manage resource consumption more effectively.
The way ahead
The specialty chemicals industry in India is at a pivotal point where sustainability is essential for growth. By adopting green chemistry, energy-efficient processes, advanced waste management practices, and digital solutions, the industry demonstrates its commitment to minimising environmental impact. Embracing these practices allows the sector to enhance its competitiveness as a sustainable manufacturing hub in the global market. To realise its potential as a leader, continuous collaboration between industry stakeholders and the government is key for promoting innovation, encouraging sustainable practices, and safeguarding the environment for future generations.