India’s versus China’s Chemical Industry – Some Data

The table below provides data on various considerations with respect to India and China’s chemical industry.  I searched the Internet for data on the two country’s chemical industry and present in the table what I found and consider to be relevant in making comparisons between the two countries.  The column “country with apparent advantage” shows the country that I consider having an advantage with respect to how the data characterizes the country’s chemical industry.

considerations	india	china	comments	country with apparent advantage
chemical employment	2 million	60 million	depends on productivity - see chemical production per employee	neither
chemical product use per person	36 kg per person per year	580 kg per person per year	much higher use in china	china
chemical production including petrochemicals, pharmaceuticals	48 million mt	812 million mt	depends on productivity - see chemical production per employee	neither
chemical production per employee	24 mt per employee	14 mt per employee	inida more productive per employee in producing chemical products	india
chemical revenue expected growth - near term, per year	9%	4 to 5%	india's economy growing at faster rate; china's environmental focus slowing chemical growth	india
chemical revenues	$163 billion       6% of gdp	$1,560 billion    12% of gdp	higher % of gdp indicates larger chemical industry	china
chemical revenues per person	$120	$1,100	higher value indicates more robust chemical industry	china
clusters	government policy	government policy	both countries have policies to develop chemical manufacturing clusters	neither
demographics	population  - 1.35 billion     gdp (ppp) per capital - $7,194	population  - 1.4 billion     gdp (ppp) per capital - $16,696	greater gdp (ppp) per capital allows for more consumption of products supported by chemical industry	china
exports - imports	net importer of chemicals - 10 million mt	net exporter but import rate increasing in need to import due to chemical plant closures for environmental reasons	assume net exporter preferred	china
foreign direct investments	no limits on foreign direct investments	limits on foreign direct investments	significant advantage for india	india
value added per product	$163 B/48 M mt = $3,396 per mt	$1,560 B/812 M mt = $1,921 per mt	significantly more value added by india's chemical products	india
world bank indices	human capital - 0.44                human development - 130	human capital - 0.67                    human development - 86	higher human capital number is better     lower human development number better	china

For the thirteen data sets presented in the table, the data suggest to me that six of the sets indicate a more positive characteristic for China’s chemical industry and four sets more positive for India.  Three sets suggest no advantage for one or the other country.

Looking at the comparisons for each set, here are some comments:

1.                  The 2018 chemical revenues for China (all period-related data are for the 2018 period) is about 9.5 times that of India.  The comparison of chemical revenues per person for the two countries is approximately the same (9.2 to 1).  Both favor China.

2.                  Although the chemical revenues for China versus India is 9.5 times higher in China’s favor, the amount of chemical product (810 million metric tons (mt) for China versus 48 million mt for India) suggests a different conclusion.  It suggests that India gains more value from its chemical product manufacturing (more revenues per product - $3,396 per product versus $1,921 per product for China).  See the “value added per product” data set in the table.

3.                  The World Bank indices data set, which compares most, if not all, countries, on certain characteristics for their populations (human capital) and how well the countries develop their populations (human development) indicate China is ahead of India.  Such indices suggest levels of education and skills, with higher levels giving advantages to a country’s chemical industry, which depends on better trained and skilled personnel.

4.                  Although India has fewer apparent advantageous data sets, information in advantageous ones for India, ((such information as: a) no limits on foreign direct investment in the chemical industry versus restrictions in China; b) apparently India gets more added value from their chemical production; and c) India’s apparently chemical revenue growth rate is 9% versus 4 to 5% for China)) is significant and shows that India does have some important advantages.