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Chemicals & PetrochemicalsManufacturers’ Association

CPMA

Annual Report

2016-17

CPMA

An OverviewThe Chemicals & Petrochemicals Manufacturers’ Association (CPMA) is the apex forum representing the Indian Petrochemical Industry. Established in 1993, the Association offers its member companies in public, private and joint sector a podium to collectively present their ideas, voice concern and offer suggestions on issues relevant to the industry and the society at large. It provides a linkage between the industry, the Government and the larger society. It interacts with the policy-makers and industry associations to develop and maintain harmonious business environment which is also conducive to greater societal well being. CPMA is also member of Asia Petrochemical Industry Conference (APIC) and represents interests of Indian Petrochemical Industry in this forum. Other APIC members are Petrochemicals Industry Associations of Korea, Japan, Taiwan, Malaysia, Thailand and Singapore.

Aims & Objectivesl To protect & promote the interests of its members and Chemicals &

Petrochemicals industry at large.

l To enhance contribution of Chemical and Petrochemical sector to the growth & development of national economy through facilitative policy regime.

l To foster co-operation between the industry and government.

l To convene conferences, seminars, exhibitions, meetings etc to further the objects of the Association.

l To interact with Government on issues relevant for growth of the industry & suggest corrective action for the same.

l To collect, collate and disseminate information of value to the industry regarding policy, key trends, production, trade, technological developments, and industry events, etc.

l To award research studies and analysis with a view to improve the efficiency of production, quality of end products and protection of environment by member companies.

l To organize delegations/visits to facilitate trade & exchange of know-how for overall promotion of the chemical & petrochemical industry in India.

Annual Report 2016-17

CPMAChemicals & Petrochemicals Manufacturers’ Association

Managing Committee K. G. Ramanathan President

Kamal P. Nanavaty Vice President & Member Co-ordination

Mahinder Singh Secretary General

Auditors R.S. Gupta & Co. Chartered Accountants 5A/19, Ansari Road Daryaganj New Delhi-110002

Bankers State Bank of India Kasturba Gandhi Marg New Delhi-110001

HDFC Bank Ltd Nanik Motwani Marg, Fort, Mumbai-400001

Registered Office Vijaya Building 10th Floor, 17 Barakhamba Road New Delhi-110001

Current Office 708, 7th Floor Kailash Building 26, Kasturba Gandhi Marg New Delhi-110001

S N A P S H O T



To,

All CPMA members

CPMA 18th AGM Notice cum AGENDA dt 17th August, 2017

Venue : CPMA Office,708, 7th Floor, Kailash Building, KG Marg, New Delhi.

Date : 08th September 2017 (Friday)

Time : 12.00 noon

1. To receive, consider, adopt the audited accounts for the year ended 31st March 2017

2. To receive the report of the Managing Committee for the year 2016-17

3. To appoint auditors for the conclusion of this meeting until the conclusion of the next annual General Meeting of the Company at the current remuneration.

4. To elect members of the Managing Committee for the year 2017-18

5. To elect the President and Vice President of the Association for the year 2017-18

6. Any other business with permission of the Chair

For Chemicals & Petrochemicals Mfrs’ Association

Sd/-

(Mahinder Singh)Secretary General



Introduction ...................................................................................................................................... 1

General Economic Situation ............................................................................................................. 1

GDP growth and general economic situation ................................................................................... 1

Outlook for 2017-18 ......................................................................................................................... 1

Polymers ........................................................................................................................................... 3

Surfactants ....................................................................................................................................... 4

Elastomers ........................................................................................................................................ 4

Aromatics ......................................................................................................................................... 4

Fibre Intermediates .......................................................................................................................... 4

Association Activities

l Submission under India-Korea CEPA ........................................................................................... 7

l Submission under India-Korea CEPA – Impact on Synthetic Rubber Industry ............................ 7

l Submission on anomaly in classification of PVC in FTAs with Malaysia & ASEAN ....................... 7

l Submission on Import of uncompounded PVC resin - clearance under wrong HS code ............7

l Submission on Identification of tariff lines requiring reduction ................................................. 7

l Submission on ID on PET ............................................................................................................ 7

l Submission for SAFTA ................................................................................................................. 7

l Submission for India-Japan CEPA ................................................................................................ 7

l Submission for India-MERCOSUR PTA ......................................................................................... 7

l Submission for India-Israel FTA ................................................................................................... 8

l Submission for Pre-Budget ......................................................................................................... 8

l Submission for RCEP ................................................................................................................... 8

REPRESENTATIONS TO CII/FICCI/ASSOCHAM

l Submission to FICCI / CII / ASSOCHAM for Union Budget 2017-18 ............................................ 8

l 25th SAC Meeting on JPMA .......................................................................................................... 8

l Support to BIS for framing standards – downstream industry ................................................... 8

C O N T E N T S



CONFERENCES supported / jointly organised by CPMA

l Vinyl India 2016 .......................................................................................................................... 9

l Injection Moulding & Blow Moulding International Summit – 2016 .......................................... 9

l Specialty Films & Flexible Packaging Global Summit 2016 ......................................................... 9

l Indian Petrochem - 2016 ............................................................................................................ 9

CPMA Website ............................................................................................................................ 9

Indian Centre for Plastics in the Environment Activity Report forthe period 2016 – 17 ............................................................................................................... 10

WASTE MANAGEMENT PROJECTS – ICPE INITIATIVE ................................................... 11

ICPE - ENVIS Newsletters ....................................................................................................... 11

ICPE Website .............................................................................................................................. 11

Acknowledgements ................................................................................................................. 12

Auditor’s Report & Accounts................................................................................................ 13

CONTENTS (Contd.)



IntroductionYour Managing Committee has pleasure in presenting the eighteenth Annual Report on the activities of the Association along with the audited Statement of Accounts and the Balance Sheet for the year ending 31st March 2017.

As the apex body of Indian Petrochemical industry, CPMA has completed 25 years, relentlessly working to create and sustain an environment conducive to the growth of the industry. During this period, it has taken several initiatives towards fulfilling its mandated role as the nodal agency for the industry, bringing together the government, industry and society at large; to facilitate growth of the industry as well as the economy. Its efforts towards building synergy between government, industry and society have helped it to maintain its lead as the proactive provider of business solutions through research, issue advocacy and global networking considering the prevailing economic situation.

General Economic Situation

GDP growth and general economic situationIndia has become the sixth largest manufacturing country in the world, rising up from the previous ninth position, and thus retaining its bright spot in the world economic landscape. In the last few months, two far reaching changes happened in the Indian economy – demonetisation and passing of the GST Bill. In order to weed out unaccounted money from the system, the Government demonetized high value currency notes in November 2016. As a result, there was a temporary shortage of cash, which also provided a major boost to digital transactions. However, after the initial period of hardship, things have rapidly normalized. GDP grew 7.1% in the financial year 2016-17, slower than the 8% registered in 2015-16. The GDP numbers are based on the new 2011-12 base year recently adopted for data including the Index of Industrial Production (IIP) and Wholesale Price Index (WPI). Gross value added (GVA) growth was 6.6% for 2016-17 and 5.6% in the fourth quarter, compared with 7.9% in 2015-16 and 8.7% in Q4 of that year.

Outlook for 2017-18Despite decline in growth rate, there is a silver lining for the Indian economy. The decline in GDP growth rate may lead to an announcement of a cut in lending rates by the Reserve Bank of India (RBI) by September. Industry is already demanding a cut in lending rates.

Economic growth in India is expected to stay high in Fiscal Year 2017-18 on the strength of robust consumer demand from a general increase in wages that offsets a slowdown in investment. The enactment of legislation to allow a national value-added tax was a milestone reform that will create a much more integrated and productive economy. The growth forecast for the current fiscal year remains between 7% and 8%. Many observers predict a boost after the roll out of the Goods and Services Tax (GST) from July 1. Ongoing efforts to restructure bank balance sheets to revive lending and reduce excessive leverage at large corporations is setting the stage for a recovery in investment spending likely to drive growth higher in FY2017-18.

The Indian Meteorological Department has predicted a normal monsoon. This will be the first normal monsoon since Narendra Modi government took over in 2014. It augurs well for agriculture and allied sectors. According to the Central Water Commission data, most of the 91 reservoirs in the country have more water than expected during pre-monsoon weeks. A normal monsoon under such circumstances is likely to propel agriculture and related sectors growth rate up. The GST factor is also expected to push agriculture and allied sectors. It is expected that with demonetisation and amended laws aimed at curbing black money, a greater portion of unorganised pockets of economy will make a shift to formal economy, which may see better figures in the next quarter and fiscal year. More importantly, it is believed in the long run India may benefit immensely from the increased digitalization of the economy and expansion of the formal banking sector. India is likely to gain momentum in the year to come as the results of earlier measures are visible. The key factors which are likely to aid growth during the year are the impact of the executive action addressing systemic issues in key sectors like mining, railways, defense, banking, roads and power. Further, the pay commission suggestion for hikes in payouts for government employees coupled with continued accommodative stance and look out for emerging room for more rates easing by the Apex bank is likely to bring in positive sentiments and scope for expansion of the economy. The prime minister’s strong leadership, the recent reforms and initiatives, and the Reserve Bank’s prudent monetary policies are building up confidence among investors

l Rupee The Indian rupee hit a 17-month high against the US dollar in

March, buoyed by strong capital inflows into equities and debt instruments such as masala bonds. Experts are concerned that a stronger rupee could potentially hit local companies’ exports and earnings. So far this year, the rupee has gained 5.5%, the most in Asia barring the South Korean won and the Taiwanese dollar, as foreign investors bought $14 billion of local equities and debt. Rupee’s performance till now has been an outcome of improvement in macroeconomic factors like decline in current account deficit (CAD), higher levels of foreign reserves and lower inflation. A part of the appreciation-level was also added by PM Narendra Modi’s BJP government win in Uttar Pradesh elections and US Federal Reserve 25 basis point rate hike which weakened dollar index further. It is believed that a strong rupee should result in lower crude oil prices for Indian basket and that should keep both CPI and WPI under check in the near term.

l CAD India’s current account deficit (CAD) narrowed during last

fiscal due to a contraction in the country’s trade deficit. According to data furnished by the Reserve Bank of India (RBI), the CAD for last fiscal narrowed to 0.7 per cent of the GDP from 1.1 per cent in 2015-16 on the back of the contraction in trade deficit. The current account is the net difference between inflows and outflows of foreign currencies. India’s trade deficit during the fiscal under review

Annual Report 2016-17 2


narrowed to $112.4 billion in 2016-17 from $130.1 billion in 2015-16. Net invisible receipts were lower, mainly due to moderation in both software exports and net private transfer receipts, and higher outgo on account of primary income (profit, interest and dividends), as per RBI.

l Inflation Retail price inflation, measured by the Consumer Price

Index (CPI), rose to 3.7% in February 2017 from 3.2% in January 2017. Retail price inflation rose for the first time after recording a fall in past six months. Inflation in both rural and urban India witnessed an increase. Food inflation increased to 2.01% in February 2017 from 0.5% a month ago. The fuel & light group recorded a rise in inflation to 3.9% from 3.4% in the previous month. Inflation at the wholesale level, measured by the WPI, rose to a 39-month high of 6.55% in February 2017 from 5.3% in January 2017. With that, the difference between WPI and CPI inflation, which was merely 25 basis points in November last year, has increased to 290 basis points in February this year, thus widening the gap between the two.

l Uncertainty regarding Crude Oil From plunging to $26 in February 2016 before climbing back

to $52.7 in December, oil prices defined volatility. But the decision by the Organization of the Petroleum Exporting Countries or OPEC to cut oil production has led to the commodity piece firming. Led by Saudi Arabia, OPEC has decided to produce less oil, by nearly 1.8 million barrels per day. Analysing the OPEC decision and Russia’s keenness to join the production cut, the International Energy Agency (IEA) assumes that there will be deficit supply in the first half of 2017, itself. Experts expect prices to be upwards of $60. Simply put, this means oil prices will zoom, which does not bode well for the Indian economy. The uncertainty around commodity prices, especially that of crude oil, has implications for the fiscal situation of emerging economies. It is however expected that increase, if any, in oil prices would get tempered by quick response from producers of shale gas and oil.

l Global Economic Situation With buoyant financial markets and a long-awaited cyclical

recovery in manufacturing and trade, world growth is projected to rise from 3.1 percent in 2016 to 3.5 percent in 2017 and 3.6 percent in 2018. But binding structural impediments continue to hold back a stronger recovery, and the balance of risks remains tilted to the downside, especially over the medium term. With persistent structural problems—such as low productivity growth and high income inequality—pressures for inward-looking policies are increasing in advanced economies. These threaten global economic integration and the cooperative global economic order that has served the world economy, especially emerging market and developing economies, well. The world economy gained speed in the fourth quarter of 2016 and the momentum is expected to persist. Global growth is projected to increase from an estimated 3.1 percent in

2016 to 3.5 percent in 2017 and 3.6 percent in 2018. Activity is projected to pick up markedly in emerging market and developing economies because conditions in commodity exporters experiencing macroeconomic strains are gradually expected to improve, supported by the partial recovery in commodity prices, while growth is projected to remain strong in China and many other commodity importers. In advanced economies, the pickup is primarily driven by higher projected growth in the United States, where activity was held back in 2016 by inventory adjustment and weak investment.

l Global Petrochemical Industry In 2016, the global demand for 30+ commodity chemicals

and plastics totalled 1,128 million metric tons. This demand is forecast to grow over 200 million metric tons at an average pace of about 3.5% over the coming five years, a rate that is very close to the 3.4% level seen for the historical period 2011-2016. About half of this growth will be focused on the broader Asia Pacific region, with the lion’s share (35%) concentrated in China.

Thus despite forecasts for a slowing economy China remains the dominant driver of global demand. As a result, by 2021, 37% of global demand will be in China. This aligns with a forecast average growth rate of domestic demand of just under 5%, 3% below the 2011-2016 average pace. The remaining 50% demand growth is split roughly evenly between the Middle East, N. America and other. West Europe is forecast to grow only mildly as the structural issues impacting the broader economic outlook translate into tepid chemical demand growth.

For most of 2016, Asian polyethylene (PE) markets were generally on a stable to firm price trend with a couple of fluctuations at certain periods. A growing concern among market participants in Asia now is whether a similar price trend can be replicated in 2017 amid mounting pressure from additional global capacities. The OPEC and non-OPEC oil-producing nations’ decision to cut oil production boosted crude prices in late 2016 and led PE suppliers to increase their offers in the Asian markets. However, while producers raised prices based on feedstock costs, converters lamented that plastics demand in key sectors such as packaging, consumer goods and construction had been subdued throughout 2016 amid dull macroeconomic conditions. Subdued demand is expected to last through 2017.

Supply tightness amid resumed restocking activities in China after the Golden Week holiday in October 2016 had pushed prices up substantially, particularly for low density polyethylene (LDPE). Producers from Saudi Arabia, Iran and across the Middle East, from Southeast Asia and India allocated more cargoes to China for better netbacks. True enough, Chinese prices softened nearer to the Lunar New Year holiday, which falls at the end of January 2017, amid falling LLDPE futures prices and a slowdown in trading activity. Although some suppliers expected the drop in PE prices in Asia to be minimized by firm regional naphtha and



ethylene costs, some were worried that ample additional global polymer capacities would create supply pressure and weigh down prices in 2017.

l Indian Petrochemical Industry India-origin export PE cargoes are expected to be available

in China, and potentially Southeast Asia, on a regular basis in 2017. The region’s approximately 2m tonnes/year of PE expansion plans would prompt Indian producers to export PE cargoes to other Asian regions, mainly to China and Southeast Asia, as domestic demand alone will not be able to absorb the additional supply.

In the meantime, India’s import demand has been subdued following the demonetisation exercise in November which halted trade in the region as a majority of trade is typically done on a cash basis. On the supply side, India’s ONGC Petro additions Limited (OPaL) started its two HDPE/LLDPE swing units with nameplate capacities of 360,000 tonnes/year each and a 340,000 tonnes/year stand-alone HDPE facility in the February of 2017. India’s Reliance Industries is also expected to start-up its LDPE and LLDPE/HDPE units with a combined capacity of 1.1m tonnes/year in the first half of 2017. Overall demand-wise, a slow-moving consumer goods sector, and persistent weak downstream demand for finished goods in the first half of 2017 is expected to exert downward pressure on polymer prices in the region. In the meantime, generally weak Southeast Asian currencies are likely to continue to hamper imports in 2017.

India may turn into a net exporter of polyethylene (PE) in the second half of 2017, as the country will welcome hefty new capacities in the western state of Gujarat. The possible target export markets are China, Turkey, Africa and Southeast Asia as India’s domestic PE capacity will increase by 2.01m tonnes by mid-year. The expected increase in India’s overall PE capacity is higher than its recorded total PE imports in the fiscal year ending March 2016. The country, which has a current PE capacity of more than 3m tonnes/year has always been an importer of the polymer until late last year, when a domestic cash crunch prompted PE producers to tap the export market to offload inventory. By the second half of the year, however, India’s PE capacity will have outpaced domestic demand, making exports necessary for its local producers. PE products would most likely be marketed into Asia, particularly China, which has a strong demand for the material. In December 2016, major Indian producer RIL spearheaded the PE exports due to a severely weakened domestic demand after the government’s surprise demonetisation of the rupee (Rs) 500 and Rs1000 notes, which accounted for more than 80% of the money in circulation at that time.

In fact, weak local demand in December 2016 presented a good opportunity to venture into global markets to establish a customer base for PE when new facilities start commercial production in 2017. GAIL India Ltd (GAIL), had also forayed into exports for the first time late last year, with a few consignments sent to Southeast Asia, where netbacks are

better. The company’s 400,000 tonne/year LLDPE/HDPE swing facility resumed operations in January 2017, after more than a month of shutdown following technical issues at the unit’s reactor. The plant was commissioned in March last year. Meanwhile, new PE producer OPaL is also keen to export to China and Southeast Asia when it is able to establish distribution channels sometime in the second half of 2017. There is a strong likelihood that imports of these polymers will substantially fall when the new domestic capacities start up.

Polymers For the Indian petrochemical industry in 2015-16- the key application industries like packaging, construction, and automobiles actually helped pull up the demand and declining prices resulted in higher offtake by downstream converters for virtually all polymers.

Government of India’s initiatives like Digital India, Swachh Bharat, Start-up India and Skill development program etc. have started and will eventually a widespread multiplier effect. One can expect them to fuel petrochemical demand in India in the years to come.

India witnessed a rebound in auto sales in the second half of 2016 and the trend is expected to continue in 2017 as well as passenger vehicles recorded a growth of 9% in February 2017 and within PVs the UV sales registered a jump of 22% and Van segment at 8%. CV sales surged by more than 7%, M&HCV registered 5% while LCV segment climbed up by 9%. International markets proved to be lucrative for Indian vehicle makers in February 2017, when India’s vehicle exports surged by 11.84%.

Success of ‘Make in India’ programme will be a game changer and a big boost to manufacturing in the country. Increased focus on agriculture and irrigation will boost the demand for plastics along with GOI’s thrust on infrastructure followed by a good monsoon forecast in 2017 by IMD.

A few of the many such initiatives that are likely to result in new opportunity for industries and positively push the demand for petrochemicals are: Rapid expansion of Metro Rail Projects across the country and electrification of existing & addition of new railway lines. The government has set a target of constructing 15,000 km of highways in the next financial year, 50% more than that in the current fiscal. The launch of Smart Cities and emphasis on Rural Development, expected to have a huge demand push for overall petrochemicals sector.

Last but not the least, the likely highly anticipated roll-out of Goods and Services Tax (GST) roll-out in 2017 would have a very positive impact on the way business is conducted. The opportunities are huge, and the petrochemical industry stands to benefit in a big way. These proposals and the focus to support the start-ups will also go a long way in encouraging domestic manufacturing and demand. A number of Indian state-owned energy companies are making major investments to boost their petrochemical activities and are expected to become significant players in the sector. Capacity expansions by several other



India’s Petrochemical Capacity

Source: Industry Estimates, A=Actuals, E=Estimates

(KT) 2011-12 2012-13 2013-14 2014-15 2015-16A 2016-17E

Ethylene 3907 3907 3907 3515 3907 4842

Propylene 4141 4141 4371 4230 4601 4773

Butadiene 295 295 295 435 435 550

Benzene 1260 1260 1260 1315 1560 1710

Toulene 270 270 270 270 270 270

OX 420 420 420 420 420 420

MX 90 90 90 90 90 90

PX 2448 2472 2472 3009 3392 3662

EDC 350 205 190 190 190 190

VCM 856 856 906 906 981 981

Styrene 0 0 0 0 0 0

LAB 530 530 530 530 530 570

EO 203 208 234 253 268 268

PTA 3930 3930 3930 3930 5652 6226

MEG 1300 1200 1200 1200 1200 1200

Acrylonitrile 40 40 40 40 0 0

Caprolactum 70 70 70 70 70 70

LDPE 205 205 205 205 205 205

EVA 15 15 15 15 15 0

LLDPE 965 980 980 980 980 1640

HDPE 1795 1795 1795 1830 1830 2810

PP 3700 4140 4180 4130 4520 5120

PVC 1335 1345 1390 1390 1470 1482

PS 472 472 472 472 476 490

PBR 74 74 85 114 124 124

SBR 20 20 40 140 290 290

NBR 20 20 20 20 20 20

EPDM 10 10 10 10 10 10

PET 814 834 950 1140 1765 1815

VSF 325 325 490 490 490 490

PSF 1075 1150 1260 1260 1260 1260

ASF 148 166 158 98 98 98

PPSF 13 13 13 13 13 13

NFY 58 58 76 76 76 76

PPFY 18 18 18 18 18 18

CBFS 1495 1595 1925 1925 1925 1925

CB 935 1027 1040 1040 1040 1040

Total 33602 34156 35307 35769 40191 44747

% Change 2% 3% 1% 12% 11%



India’s Petrochemical Consumption

Source: Industry Estimates, A=Actuals, E=Estimates

(KT) 2011-12 2012-13 2013-14 2014-15 2015-16A 2016-17E

Ethylene 3370 3767 3784 3510 3895 4830

Propylene 3700 3880 4150 4020 4590 4770

Butadiene 114 113 120 172 241 306

Benzene 606 593 567 475 490 495

Toulene 385 447 404 440 520 530

OX 266 281 278 287 280 289

MX 85 83 100 140 157 187

PX 2154 2263 2298 2442 3219 3942

EDC 628 638 652 646 675 699

VCM 1261 1280 1318 1281 1387 1413

Styrene 520 551 572 617 697 750

LAB 470 500 509 531 559 598

EO 167 172 187 188 194 201

PTA 3852 4106 4398 4641 5144 5461

MEG 1586 1644 1840 1882 2096 2227

Acrylonitrile 113 115 147 152 151 157

Caprolactum 86 93 96 101 131 144

LDPE 484 443 444 515 669 703

EVA 98 116 131 143 152 158

LLDPE 1183 1240 1236 1328 1542 1695

HDPE 1661 1781 1766 1828 2038 2239

PP 2792 3142 3253 3509 4192 4395

PVC 1979 2263 2309 2443 2699 2988

PS 248 250 217 238 261 275

PBR 155 168 170 171 174 186

SBR 197 230 270 290 306 313

NBR 31 35 38 45 50 56

EPDM 28 32 35 33 42 46

PET 504 603 660 700 770 900

VSF 246 257 278 268 305 339

PSF 779 812 835 862 932 917

ASF 86 96 113 101 101 101

PPSF 4 4 4 5 5 5

NFY 42 45 45 52 52 52

PPFY 14 17 12 11 14 14

CBFS 1400 1545 1450 1430 1520 1650

CB 682 798 880 850 932 1009

Total 31975 34403 35566 36346 41181 45039

% Change 8% 3% 2% 13% 9%



manufacturers are moving ahead and gradually filling the gap between domestic demand and supply.

Overall, the outlook for the petrochemical industry in India is somewhat more positive than it has been recently, as growth in GDP and industrial output is expected to be higher in 2016-17 than in the prior year, and key end-use industries like automotive, packaging, and consumer durables reflect this outlook.

SurfactantsDemand for key surfactant LAB increased by 5.3% in 2015-16 and is expected to grow at a higher rate at 7% in next fiscal. LAB capacity witnessed an addition of 20 KT by IOCL in 2015-16 and with witness another 20 KT addition in next fiscal as well taking the total capacity in India to 570 KT in that year. LAB import is were higher in 2015-16 as compared to previous year at 189 KT however will see a dip in next year to touch 167 KT in 2016-17 before spiking a high of 177 KT in 2017-18. Exports are also expected to remain at same level of 6 KT in 2015-16 till next two fiscals. EO capacity increased from 253 KT in 2014-15 and further is expected to touch 268 KT in the next fiscal. Debottlenecking of EO capacity by RIL in 2012-13 happened and in 2014-15. RIL capacity was enhanced from 188 KT in 2015-16 to 203 KT in 2016-17. Demand for EO grew at 3.3% and is expected to be around 3.5-4% in next two fiscals.

ElastomersSBR which accounts for 40% of the total synthetic rubber demand is consumed mostly in the tyre sector. Considering the large amount of SBR that is being consumed in the manufacture of tires and tire products, demand is very much dependent on the automotive industry and tire sectors as a whole.

On a positive note, growing use of low-rolling-resistance tires to reduce fuel consumption and decrease CO2 emissions should increase SBR demand. In 2015-16, synthetic rubber demand grew at 5% and is expected to maintain the same growth rate in 2016-17. Styrene butadiene rubber (SBR) prices in India witnessed a fall in March 2017, dragged down by continued slump in the feedstock butadiene (BD) market, amid abundant stocks and tepid demand. Downstream tyre makers in the country retreated to the sidelines, holding back their purchases for the month, which marks the end of India’s fiscal year.

Spot offers for SBR non-oil grade 1502 at $2,800-2,900/tonne CFR (cost and freight) India were met with little interest. On 1 March, SBR prices were assessed stable for the second consecutive week at an average of $2,800/tonne CFR India, following a 62% surge from late November 2016, as per ICIS data. Falling prices of rival product natural rubber (NR) further exerted downward pressure on SBR prices, market sources said. NR prices have been fluctuating in the $2,000-2,300/tonne range, much lower than the current SBR prices, encouraging tyre makers to adjust their formulations to include more NR. India’s SBR demand typically weakens in March as tyre manufacturers are unwilling to build up their stocks before the new fiscal year starts. Availability of cheaper deep-sea material from Europe and Russia has also been weighing down on demand for Asia-origin SBR.

SBR demand registered a growth of 5.5% in 2015-16 and expected to be subdued around 3% in following two years. Imports are expected to significantly reduce by 2016-17 onwards with RIL new capacity coming up to full steam. India is expected to jump three places to become the world’s No.3 car market by 2018. This has fuelled a domestic rush to produce more of the synthetic rubber that is mixed with natural rubber to make tyres. EPDM demand rebounded and witnessed a robust growth of 27.3%in 2015-16 and is expected to grow at 10% in 2016-17 before a slowdown in 2017-18. Reliance is the only producer of PBR in India. PBR demand growth rate is expected to improve to ~7% by 2016-17 from a low of ~0.1% in 2015-16 and furthermore to 8.2% in 2017-18.

AromaticsOverall other key petrochemicals demand in 2015-16 witnessed a growth of 8% and is expected to witness a growth of 2-3% in next fiscal years. Benzene demand witnessed a positive growth after negative growth in previous year at 3.2% in 2015-16 and is expected to grow at the same rate over next two years. Exports too are expected to further increase by 2017-18 and touch 1362 KT with capacity additions by RIL and OPAL. Toluene demand registered a robust growth of ~18.2% in 2015-16 and expected to witness a subdued demand growth of 2% in next two fiscals. MXS witnessed a growth in demand at 12% in 2015-16 and is expected to register even better growth in next fiscal. Imports in case of MXS are expected to rise to 138 KT by 2017-18 from 79 KT in 2015-16. Meanwhile, OX registered a negative growth rate of 2.4% in 2015-16. There is no new capacity addition lined up for OX, however, demand is expected to increase to 289 KT by 2016-17.

Fibre IntermediatesIn 2015-16, the combined production of fibre intermediates viz. ACN, Caprolactam, PTA and MEG reached 5967 KT of which PTA and MEG constituted% and 18% respectively with ACN and Caprolactam together accounting for the remaining 4%. PTA and MEG constituted 40% and 60% of the total 1736 KT fibre intermediates imported in 2015-16. Fibre intermediates exported from India in 2015-16 was 244 KT and is expected to jump to 344 KT in 2016-17 and 1014 KT in 2016-17 with the addition of new PTA capacity from RIL and JBF. ACN production was stopped by RIL and demand is being met by imports on the back of pesticide industry doing well. PTA import volumes into India (which is another big and growing polyester market in Asia) are also expected to decline after the new plant by Reliance Industries runs at full capacity and touch 361 KT by 2016-17 and further witness a dip by 2017-18 to touch 60 KT.

IOCL, meanwhile has planned glycol project - the Mono Ethylene Glycol project includes Ethylene Recovery Unit of 180 KTA and Glycol Unit of 326 KTA. This plant is targeted for commissioning by November 2019. Two more projects have been planned for the petrochemical complex - 1,200 ktpa PTA plant and petcoke gasification-based synthetic ethanol plant. Both projects are due to be commissioned by September 2021.



Caprolactam, which is used to manufacture automobile tyre cord, should benefit from an increase in discretionary spend, once the global economy returns to the growth path. At present, GSFC is the largest (56% share) and one of the only two manufacturers of the chemical in India with 70,000 tonnes per annum production (full capacity), of which around 17,000 tonnes is used internally for production of nylon and the rest is sold. The company has also taken debottlenecking and efficiency improving measures to further improve the EBIT by around Rs 75 crore.

Demand for nylon 6, which uses caprolactam as a raw material, remained largely unchanged. Caprolactam prices have been rising over the past few months (Dec 2016) after the shutting down of capacities in Europe and America. Global chemical majors such as BASF and Fibrant have closed their capacities due to falling profitability from rising capacities in Asia.

Tight supplies and rise in caprolactam’s raw material prices -benzene and crude-led buyers to rush to acquire the chemical. In 2015-16 demand for caprolactam grew at a staggering ~30% and is expected to grow at 10% next fiscal before a slowdown in 2017-18 to grow at 2%.

ASSOCIATION ACTIVITIESFTAsSubmission under India-Korea CEPACPMA made a submission to Joint Secretary, Dept. Of Commerce, GoI and urged the need to keep all key petrochemicals in the Korean wish list excluded from tariff concessions in the interest of the domestic industry. The letter also suggested the tariff concessions be provided to Korea on EPDM as currently there is no domestic manufacturer and as one of our member companies is actively considering setting up domestic capacity of EPDM and providing tariff concession on this item to Korea will affect this likely new investment adversely.

Submission under India-Korea CEPA – Impact on Synthetic Rubber IndustryIn response to an issue concerning the India-Korea CEPA, CPMA had sent a communication to the Joint Secretary, Dept. Of Commerce, GoI, highlighting the impact of India-Korea CEPA on Synthetic Rubber Industry. The letter stated that due to low import duty on synthetic rubber and duty concessions allowed to Korea under FTA’s, imports from Korea have surged. Concessional duty under FTA on synthetic rubber not only affects viability of domestic production but also depresses domestic natural rubber prices and returns to lakhs of planters. Besides these negative impacts, there is substantial revenue loss to government.

Submission on anomaly in classification of PVC in FTAs with Malaysia & ASEAN CPMA made a submission before Joint Secretary (Customs) CBEC, Ministry of Finance for review of the classification of PVC in FTAs with Malaysia & ASEAN as domestic industry strongly feels that there is a compelling case for Government of India to revisit, review and renegotiate the categorization of petrochemicals and India’s tariff concession commitments under the India-ASEAN &

India - Malaysia FTAs. The submission was reviewed and in the budget 2016-17 the same was addressed.

Submission on Import of uncompounded PVC resin - clearance under wrong HS codeCPMA made a submission before Joint Secretary – Commerce for review of import of uncompounded PVC resin which was being cleared under wrong HS code and wrong availment of concessional duty on imports was happening from ASEAN which was causing loss of revenue to GoI. Submission requested to stop this malpractice so that GoI is not deprived of its legitimate revenue and domestic producers of PVC resin are not left to face unjust competition.

Submission on Identification of tariff lines requiring reduction CPMA made a submission to Director, Department of Chemicals & Petrochemicals requesting to consider renegotiating the categorization of petrochemical products under India’s key FTAs viz the ones with ASEAN, Singapore, Malaysia, Korea and Japan and include these products in the negative list so that these are not subjected to any tariff concessions under the FTAs.

Submission on ID on PETCPMA made a submission before Joint Industrial Adviser, Ministry of Chemicals and Fertilizers, Department of Chemicals and Petrochemicals requesting to consider aligning import duty on PET from the existing 5% to 7.5% to bring it at par with other plastics.

Submission for SAFTACPMA made a submission to Assistant Secretary General, FICCI with regard to sensitive list of SAFTA member countries and submitted a list of products which needs to be excluded from the sensitive list of SAFTA member countries and requested that the duty-free exports of these items from India be allowed under SAFTA.

Submission for India-Japan CEPACPMA made a submission with regard to India-CEPA Joint Committee Meeting and submitted a list of products which are currently included in categories earmarked for tariff elimination be recategorised and shifted to the Exclusion List and requested that no tariff concessions be granted on these by India to Japan under the CEPA.

Submission for India-MERCOSUR PTACPMA made a submission with regard to India-MERCOSUR PTA and requested that the key petrochemical products like polymers viz Polyethylene, Polypropylene, Polyvinyl chloride, Polystyrene and Polyethylene terephthalate be excluded from all tariff concessions for exports from MERCOSUR to India as per the analysis of MERCOSUR wish list. CPMA urged to continue keeping these items in the Exclusion List and not offer any tariff concessions on these to MERCOSUR. The letter also submitted that lndia has adequate capacity to cater to domestic demand and new capacities are currently being commissioned which will create substantial surplus in the country. In this scenario, the domestic industry strongly feels that India should not offer any tariff concession on PTA to MERCOSUR.



Submission for India-Israel FTACPMA made a submission with regard to India-Israel FTA and submitted a list of products which on which Indian Industry is seeking tariff concessions under the proposed FTA.

Submission for Pre-BudgetCPMA made a submission to Member (Budget & GST), CBEC, Ministry of Finance, Govt. of India with regard to pre-budget highlighting the state of petrochemical industry, impact on downstream industry, and problem of capacity utilization due to high imports and lastly provided inputs on GST.

Submission for RCEPCPMA made a submission with regard to RCEP seeking that Government should take cognizance of the ground realities while offering tariff concessions to RCEP member countries and appropriately safeguard the interests of the domestic industry. Submission further stated that Tariff concession commitments under FTAs are usually permanent and once granted were virtually impossible to remove as the petrochemical industry has seen with the India-Singapore CECA. Secondly, it highlighted that Indian industry is plagued with several disadvantages vis-à-vis producers in RCEP countries as it has to grapple with high cost factors like high interest rates, higher duties on plant and machinery, etc., while petrochemical industry in several RCEP countries were developed on the back of benefits/ concessions by respective Governments. The submission further stated that the high cost factors like high cost of capital, power tariff, infrastructure bottlenecks, high transaction costs etc. continue to erode domestic industry’s competitiveness. In fact countries like Singapore, where the domestic market for petrochemicals is negligible, has seen large investments by global players for exporting to the large markets in the vicinity, like India. Submission highlighted that the Eliminating tariff on key petrochemical tariff lines under RCEP for exports from countries like China and ASEAN will have tremendous adverse impact on domestic manufacturers of these products and make the substantial investments made for augmenting the large domestic capacities, financially unviable. Lastly a list of key petrochemical products to be excluded from all tariff concessions under the RCEP was submitted.

REPRESENTATIONS TO CII/FICCI/ASSOCHAMSubmission to FICCI / CII / ASSOCHAM for Union Budget 2017-18CPMA made submission to National Forums for review of import duties on petrochemical inputs; import duty on polymers urging the need for bringing the Indian duty structure closer to developed economies. Due to adverse fiscal and regulatory environment, investment in petrochemical sector has witnessed significant deceleration. As a result, downstream industry is rapidly becoming more import dependent depriving local value addition and employment. The submission highlighted that India already has substantial surplus of Polypropylene and is in the process of adding massive new Polyethylene capacities in current year which will create huge surplus for Polyethylene as well. These new investments would need fiscal support for

their financial viability especially in the context of the massive Shale gas-based capacity coming up in the US (around 8 MMT of new ethylene capacity is under commissioning in the US). For PVC, no new capacity has been added in the country for over a decade despite demand exceeding existing capacity consistently. In view of the surplus in Polyethylene and Polypropylene and the need for a facilitative fiscal structure for the development of the domestic PVC industry, import duty on polymers like PE, PP, PVC and PS, be increased from the existing level of 7.5% to 10%. In addition import duty of PET, which is a plastic raw-material, where India has large capacity and is a net exporter, is still at 5%. The country is adding large capacity of PTA, an input for production of PET. Duty on PTA is low at 5% and needs to be at par with other commodity plastics which is 7.5%. The submission asked for reduction of import duty Naphtha to 2.5% at par with other petrochemical feedstock. Import tariff on key petrochemical inputs EDC, VCM and Styrene may be brought down from 2% to zero. The submission also mentioned to raise the import duty on ABS and SAN from existing 7.5% to 10% and MEG & PTA be raised from existing level of 5% to 7.5% to rationalize the tariff structure. Submission also requested to rationalize the tariff structure for the entire value chain and avoid instances of duty inversion, import duty on POY, FDY, PTY, IDY, TOW and PSF/FF be raised from the existing 5% to 7.5%. Views on MXS and LNG were also put forth.

25th SAC Meeting on JPMACPMA attended the 25th SAC Meeting on JPMA held on 4th May 2017 under the chairmanship of the Textile Secretary. The meeting was attended by the Jute Commissioner, Representatives from Ministries of Food, Consumer Affairs, FCI, State Agriculture Depts., IJMA, AIFTMA,CPMA, etc. CPMA sent a proposal of recommendations on exemptions in compulsory packaging for the Jute Year 2016-17 for approval by GOI.

Support to BIS for framing standards – downstream industryFollowing BIS IS standards were drafted by CPMA and submitted to BIS for consideration in 24th meeting of BIS TXD 23 held on 14 July 2017 at Indian Institute of Packaging, Andheri, Mumbai.

Textiles – Laminated, Polypropylene (PP) Woven Sacks for Packing Bulk Commodities in Retail Consumer Packs – Specifications

Textiles – Polypropylene (PP) Nonwoven Sacks for Packing Bulk Commodities in Retail Consumer Packs – Specifications

Above standards were discussed during meeting. The committee has decided to constitute a small panel of subject experts, which includes CPMA, to review and prepare a final draft document for wide circulation to committee members for their comments.

Textiles - High density polyethylene (HDPE)/polypropylene (PP) woven sacks for packaging polymer materials – Specification [Doc: TX 23 (10335)]

Textiles – Polypropylene (PP) block bottom valve sacks for packaging of cement – Specification [Doc: TX 23 (10621)]

The standard was upgraded considering the developments took place in last ten years in terms of resin quality improvements



and the advancements in machinery and downstream processing technology.

Textiles - High density polyethylene (HDPE)/polypropylene (PP) woven sacks for packing cement – Specification (Third revision of IS 11652:2000) [Doc: TX 23 (10622)]

CONFERENCES supported / jointly organised by CPMAVinyl India 2016The 6th Vinyl India Summit, organised by ElitePlus Business Services and CPMA on 21st-22nd April at Hotel Grand Hyatt, Mumbai. Like all previous Vinyl summits, this was a great success and attracted even higher participation. The Vinyl India 2016 attracted approx. 770 delegates from 24 countries and 300 companies. The Summit had 67 eminent speakers representing the entire chain of Vinyl Industry, Economy and Government sectors.

Injection Moulding & Blow Moulding International Summit – 2016 The 4th Injection, Blow Moulding & PET International Summit, brought by Elite Plus Business Services and CPMA, was held at Mumbai on 18th and 19th August 2016. Like the previous 3 IMBM summits, this fourth edition was also a grand success and attracted over 552 attendees from 270 companies representing 15 countries.

Specialty Films & Flexible Packaging Global Summit 2016The 5th Speciality Films and Flexible Packaging Global Summit – 2016 was held at Hotel Grand Hyatt in Mumbai on 21st – 22nd September 2016. The Summit was organized by ElitePlus++ Business Services and CPMA, with over 930 delegates representing approximately 370 companies from over

23 countries. The summit provided a very high level platform to producers of raw materials, both Indian and overseas, all leading converting machinery manufactures from India, EU, South East and Far East, all major converters covering blown films (multilayers), cast and BOPP and BOPET, printing, lamination and post extrusion finishing including automation in material handling and the major end-users from food, pharma, personal care and agri sectors.

Indian Petrochem - 2016CPMA joined Elite Conferences Pvt. Ltd. in co-organising an International Conference “Indian Petrochem”. Over the years, the popularity of this conference has increased significantly and emerged as a unique forum for interaction between global and Indian petrochem industry.

The “Indian Petrochem - 2016” was held on 15th & 16th November 2016 at Hotel - The Lalit, Mumbai. This conference attracts a wide audience with 300-350 participants from the Indian and global petrochemical fraternity. The focus of this conference was on Indian Petrochemical market, particularly the olefins and aromatic chains. The participants of this conference were immensely benefited from the deliberations and distinguished panel of industry speakers shared their massive knowledge through their speeches and presentations.

CPMA WEBSITECPMA Web statistics shows substantial increase in viewership from a level of less than 1 lac to 2.04 lac in a month with highest hits registered in March 2017. In fact, maximum hits were registered in the year 2016-17. Every month on an average 3000 new / unique visitors got added.

Month Unique Visitors Number of Visits Pages Hits Bandwidth

Apr 2016 3,610 5,242 21,429 190,291 13.36 GB

May 2016 2,625 3,532 12,902 127,116 9.38 GB

Jun 2016 2,971 3,950 24,443 134,006 18.78 GB

Jul 2016 2,807 3,805 12,446 124,392 16.98 GB

Aug 2016 2,940 4,010 14,970 117,305 28.77 GB

Sep 2016 2,938 4,327 17,086 143,553 38.61 GB

Oct 2016 4,300 6,359 21,477 198,145 26.01 GB

Nov 2016 3,866 5,827 16,782 178,696 31.59 GB

Dec 2016 3,223 4,768 14,678 135,632 22.67 GB

Jan 2017 4,049 5,583 17,367 133,051 23.27 GB

Feb 2017 5,409 7,502 20,513 176,792 31.52 GB

Mar 2017 4,552 7,050 21,369 204,934 40.23 GB

Total 43,290 61,955 215,462 1,863,913 301.17 GB



Indian Centre for Plastics in the Environment Activity Report for the period 2016 – 17SEMINARS / CONFERENCES / WORKSHOPS / EXHIBITIONS:Participated in the following Seminars / Conferences / Workshops during the period:

1. ICPE ENVIS Centre Awareness Campaign at (Valsad Station) From 20th to 22nd April 2016:

Science Express Climate Action Special (SECAS),an innovative mobile science exhibition mounted on a 16 coach AC train which has been custom-built for Department of Science & Technology (DST) by Indian Railway. It aims to create awareness among various sections of society, especially students, as to how Climate Change can be combated through mitigation and adaptation. The SECAS was scheduled to travel across the country for about seven months, halting at 64 locations in 20 States, covering 19,800 km. It was organised jointly by DST and MoEF & CC in collaboration with Indian Railways. SECAS arrived at Valsad station on 20th April, 2016. More than 12, 000 students & number of teachers/Principals, from 20 Schools in and around Valsad visited the Science Express. ICPE actively participated in the event showcasing the Awareness Panels and interacting with the students in groups and distributing booklets. Teachers accompanying the students were specially interacted to convey the message on Plastics and the Environment and to inculcate the habit of segregating waste at source and other issues.

2. Celebration of Swachh Bharat Pakhwadas along with World Environment Day on 5th, 9th and 13th June, 2016 2.1 ICPE Envis Centre started the celebration of Swachh

Bharat Pakhwadas on The World Environment Day-2016 by launching two posters on the theme of “Save Environment”. ICPE ENVIS Centre organised an Awareness programme along with SIES – Indian Institute of Environment Management & SIES – School of Packaging, Packaging Technology Centre on 9th June, 2016 at SIES premises, Nerul, Navi Mumbai. The Awareness programme has been attended by Shri P.V Naraynan, Chairman SIES – School of Packaging, Dr. Saumya Singh, SIES, Dr. C.Srinivas of SIES-IIEM, Dr. Devayane Savant – SIES IIEM, Dr. Sneha Mishra- SIES IIEM, Shri N.Sethu – SIES, Ms. Anjali Kapoor SIES were also participated in the program. The Professors and 100 Students of SIES – Indian Institute of Environment Management & SIES – School of Packaging, Packaging Technology Centre, were also actively participated in the awareness program.

2.2. ICPE organised an Awareness programme along with Kerala Plastics Manufacturers Association (KPMA), NSS Unit 183 on 13th June, 2016 at Sreenarayan Higher Secondary School, Kochi. Mr. Joseph Sander, President, KPMA, Mr. Bava Vice President KPMA & Mr. Pranoj Prabhakar, Executive Member of KPMA were also present the programme along with the ICPE

officials. 400 Students of Class 12th and their teachers attended the Programme.

3. International Exhibition IPLEX - 2016 from 26th to 28th August, 2016 at KOCHI

ICPE Envis Centre had participated in an International Plastics Exhibition: IPLEX - 2016 organised by Kerala Plastics Manufacturers’ Association (KPMA) at Kochi, Kerala from 26th to 28th August-2016. The Exhibition has been inaugurated by Shri A.C. Moideen, Hon. Minister for Tourism & Co-operation, Govt. of Kerala. Benefits of Plastics, various Issues and Solutions through effective Source Segregation of Dry Waste including Plastics Waste and Recycling / Recovery of the same in a scientific and environmentally friendly manner were depicted with the help of Display Panels and samples of recycled products. During the Exhibition more than 10,000 students visited ICPE Stall apart from Plastic Associations Members, Industrialist and government officials.

4. AWARENESS PROGRAMMES FOR SCHOOL / COLLEGE STUDENTS

ICPE regularly conducts awareness programs in schools and colleges with emphasis on developing right attitude towards plastics in general and encouraging the students to inculcate the habit of anti-littering and segregation of waste at homes (source) into Dry and Wet to facilitate solid waste management. In 2016 -17 Academic Session, ICPE had organized Awareness Programs at:

4.1 S.N Higher Secondary School, Ernakulum, Kerala on 13th June 2016

4.2 Lady Irwin College, New Delhi on 16th & 22nd Aug. 2016

4.3 Sadhu Vaswani International School, Navi Mumbai on 16th Nov.2016

4.4 Air Force Bal Bharati School, Lodhi Road, New Delhi on 3rd Feb.2017

The Principals and teachers of school/college appreciated ICPE’s effort for organizing such awareness programs among the student. Most of the School/College authorities had requested ICE for visiting again for conducting such programs in future.

5. Legal Cases in Supreme Court/High Court/NGT Court Delhi against use of Plastics

ICPE continues to provide all technical assistance for preparing responses to various court cases against Plastics; however, it was not possible for ICPE to provide any financial support. ICPE had provided all technical inputs with relevant documents in the PET case in the NGT Court, New Delhi, in support of packaging of pharmaceutical formulations.

6. Participation in Expert Committee to frame the Plastic Waste (Management and Handling) Rules, 2016 by MoEF & CC, Government of India.

ICPE was a part of the Expert Committee to frame the Plastics Waste Management Rules, 2016. Critical inputs were



provided by ICPE which were considered in the final Rules.

WASTE MANAGEMENT PROJECTS – ICPE INITIATIVE1. “Zero Waste Management” Project at New Moti Bagh

Colony, New Delhi A Pilot Plant is running successfully at New Moti Bagh Colony,

New Delhi by the technical and financial support of ICPE since beginning of 2014. ICPE has provided financial support by bearing the cost of the Plastics Waste to Fuel Conversion Plant and also bearing part of the Capital Cost for setting up the overall Project. ICPE has been providing Ad-hoc assistance every month for running the Feedstock Recycling Plant. Rigid plastics waste, which are easily recyclable by mechanical recycling process, are collected and forwarded to recyclers for recycling. All multi-layered, thin plastics and THERMOCOL, which earlier were abandoned by recyclers and were dumped in the landfill, are now put in to the Pyrolysis Plant for converting to Fuel. It is observed that average quantity of multi-layered and other film waste and Thermocole waste generated in the colony is around 30 to 40 Kgs / per month, which is fully converted to fuel. (The Colony Administration does not allow any plastics waste from outside the Colony). At present no plastics waste (and no MSW) generated in this Colony, goes to the Landfill.

2. Project Dry Waste Segregation in Select Wards in the City of Mumbai

The Dry Waste Segregation Project in Mumbai has been successfully carried out in select Wards in Mumbai with the

initiatives of ICPE in association with some NGOs and with the assistance of Brihanmumbai Municipal Corporation since 2002-03. The results are evident in at least some Wards of Mumbai. Mumbai Municipal Corporation is now planning to implement this system in all 24 Wards. ICPE project is in select areas of 6 Wards in Mumbai city. In 2016, about 120 Waste Pickers segregated 6590 Mt of Dry Waste including 2213 Mt of Plastics Waste (corresponding figures for 2015 were 5198 MTs and 1293 Mt) and Rs. 3. 55 Cr. was earned (Rs.3.20 Cr in 2015) by selling the segregated waste to Waste Dealers / Recyclers. This is an example of successful implementation of Dry Waste Project when it is segregated at the source. The segregation at source is gaining mass support where awareness programmes were conducted.

ICPE - ENVIS NewslettersFour editions of ICPE ENVIS Eco-Echoes Newsletters were published during the FY and distributed to selected Government Officials includes in MoEF, DCPC, MoH & Family Welfare, Centre & State Pollution Control Boards, BIS, and Academic Institutions, Associations, all the ENVIS Centres etc. The Newsletters are uploaded in the website also.

ICPE WebsiteThe changes / up gradation has been made in the ICPE ENVIS website www.icpeenvis.nic.in and large number of visitors used the website as reflected in the FY. In 2016 – 17, total number of visits were 2, 70, 782 which included 41, 120 unique visitors.



A C K N O W L E D G E M E N T SThe Managing Committee would like to place on record its appreciation and gratitude to:l All members of CPMA and its Committees for their co-operation and guidance on the affairs of the

Associationl Industry Affairs Group of Reliance Industries Limited for their whole-hearted support and involvement

in the activities of the Associationl Various Ministries and Departments of the Governments of India and State Governments for their

helpful attitude to the industryl Secretary of the Association and members of the staff for their services

On behalf of the Managing Committee

CHEMICALS & PETROCHEMICALS MANUFACTURERS’ ASSOCIATION

Sd/-(K. G. Ramanathan)President



AUDITOR’S REPORT

To the Members of CHEMICALS & PETROCHEMICALS MANUFACTURERS’ ASSOCIATION

Report on the Financial Statements

We have audited the accompanying financial statements of CHEMICALS & PETROCHEMICALS MANUFACTURES ASSOCIATION, which comprise the Balance Sheet of as at March 31, 2017, and the Statement of Income & Expenditure for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance of the association in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Association for preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:(a) In the case of the Balance Sheet, of the state of affairs of the Association as at March 31st, 2017(b) In the case of the Statement of Income & Expenditure, of the surplus for the year ended on that date;

Further to above we report that:a. We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the

purpose of our audit;b. In our opinion proper books of account as required by law have been kept by the association so far as appears from our

examination of those books;c. The Balance sheet, and Statement of Income & Expenditure dealt with by this report are in agreement with the books of

account.d. In our opinion, the Balance Sheet and Statement of Income & Expenditure comply with the Accounting Standards ,

For R.S.GUPTA & CO. Chartered accountant FRN: 001216N

Sd/- (Saurabh Gupta) Partner M.No. 098371Place: New DelhiDate: 19.08.2017




1. We hereby certify that the above statement is true & fair to the best of our knowledge and behalf.

2. Balances is regrouped & remerged wherever required.

Sd/- Sd/- Sd/- Mahinder Singh KG Ramanathan Kamal Nanavaty Secretary General President Vice President

Place : New DelhiDate : 19.08.2017

BALANCE SHEET PREVIOUS YEAR LIABILITIES CURRENT YEAR AMT. (Rs.) AMT.(Rs.)

CAPITAL FUNDS: - 160,000.00 160,000.00 As per last Balance Sheet 160,000.00 160,000.00 APIC Capital Funds:- 28,753,499.00 As Per Last Balance Sheet 32,291,149.00 7,707,170.00 Add:- Addition During the year 6,403,814.00 32,291,149.00 (4,169,520.00) Less:- Utilised During the year (5,635,189.30) 33,059,774.00 R&D & I A R I STUDY FUND: - 1,754,898.00 As per last balance Sheet 1,754,898.00 - Add:- Addition during the year - 1,754,898.00 - Less: Utilised during the year - 1,754,898.00 CURRENT LIABILITIES & PROVISIONS: - - Advance Recd. From Member Co. - 57,758.00 TDS Payable 248,678.00 90,915.00 Outstanding Expenses/Liabilities 373,857.00 39,375.00 Audit Fee Payable 39,375.00 13,165.00 Liabilities (others) - - SBC Payable 2,179.00 296,910.00 Sundry creditors 51.566.00 498,123.00 715,655.00 GENERAL FUND: - 4,413,202.00 As per last Balance Sheet 6,599,863.00 2,186,661.00 Add: Excess of Income 3,803,671.00 over expenditure 6,599,863.00 10,403,534.00 PROFIT & LOSS :- 2,186,661.00 Current Year 3,803,671.00 - 2,186,661.00 Less :Transferred to General Fund 3,803,671.00 -

41,304,033.00 TOTAL 46,093,861.00



Auditor’s ReportAs per our separate report of even date attached.

For R. S. Gupta & Co.Chartered Accountants

Sd/-Saurabh Gupta

(Partner)M. No.098371

AS AT 31st MARCH, 2017 PREVIOUS YEAR ASSETS CURRENT YEAR AMT. (Rs.) AMT.(Rs.)

FIXED ASSETS: - 326,509.00 326,509.00 As per Schedule Annexed 290,160.85 290,160.85

INVESTMENTS: - 26,937,921.00 Fixed Deposits 28,272,530.30 28,272,530.00 1,334,609.00 Add: Interest Accured on FDR 1,998,510.00 30,271,040.30

CURR. ASSETS, LOANS & ADVs:- Service Tax Receivable 123,713.00 3,977,918.00 KKC Receivable 4,241.00 3,977,918.00 Other Current Assets 3,710,785.92 3,838,740.00

CASH & BANK BALANCES: - 3,792.00 Cash in hand 1,449.00 5,786,980.00 SBI Current A/c 7,524,987.77 2,936,304.00 HDFC Current A/c 3,240,476.04 8,727,076.00 - Travel Card 927,006.84 11,693,920.00

41,304,033.00 TOTAL 46,093,861.00



PREVIOUS CURRENT YEAR INCOME YEAR Amt. Rs. Amt. Rs.

PREVIOUS CURRENT YEAR EXPENDITURE YEAR Amt. Rs. Amt. Rs.


INCOME & EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31st MARCH, 2016

60,000.00 To Accountancy Charges 60,000.00

43,125.00 To Audit Fees 43,125.00

- To Affiliation Fee -

10,211.00 To Bank Charges 14,075.43

12,632.00 To Books, Newspapers & 10,518.00 Periodicals etc.

169,770.00 To Car & Other Hire Charges 151,202.00

- To Civil & Plumbing Charges

3,600.00 To Computer Running 4,283.00 & Software Exp.

389,400.00 To Contractor Charges 383,400.00

1,090,286.00 To Tour, Travelling 630,952.00 & Conveyance

83,840.00 To Depreciation on Fixed Assets 55,696.15

21,341.00 To Foreign Exchange Loss 40,644.28

66,168.00 To Electricity & Water Charges 57,728.00

196,686.00 To Internet & Telephone Exp. 147,683.00

1,762.00 To Interest paid- TDS/Service Tax 9,985.00

1,420.00 To Insurance Expense 1,447.00

350,534.00 To Meeting & Seminar 323,062.00

39,789.00 To Membership Fee 44,275.00

65,828.00 To Miscellaneous Exp. 163,415.00

309,552.00 To Office Maintenance Exp. 316,272.00

1,341,893.00 To Office Rent 1,472,310.00

49,539.00 To Postage & Courier 66,833.00

167,977.00 To Printing & Stationery 168,839.00

380,576.00 To Professional Charges 594,950.00

1,851,617.00 To Salary, Wages & Bonus 3,144,950.00

119,656.00 To Staff Welfare 83,308.00

78,403.00 To Sundry Bal. Written off 442,422.49

6,900,000.00 By Subscription received 8,086,956.00 from Member Companies

297,200.00 By Interest on Fixed Deposits 291,698.00

94,611.00 By Interest on Income Tax 47,141.00

962,121.00 By Subscription (Supplementary)

950,000.00 By Royalty & Branding 1,200,000.00 Charges

100,000.00 By Sponsorship Fee

5,798.00 By Sundry Balance 11,093.00 written back

- By Business Support Services 825,000.00

By Advisor Remuneration 2,100,000.00

3,019.00 By Short & Excess



PREVIOUS CURRENT YEAR EXPENDITURE YEAR Amt. Rs. Amt. Rs.

PREVIOUS CURRENT YEAR INCOME YEAR Amt. Rs. Amt. Rs.

To Income Tax 83,162.00

To Petrol & Diesel 51,855.00

- To Short & Excess -

133,146.00 To Subscription Charges/Fee 191,825.00

87,337.00 To Sponsorship Fee -

2,186,661.00 To Excess of Income 3,803,670.65 over Expenditure c/d to Balance Sheet

9,312,749.00 TOTAL 12,561,888.00 9,312,749.00 TOTAL 12,561,888.00



Auditor’s ReportAs per our separate report of even date attached.


Sd/-Saurabh Gupta





SCHEDULE OF FIXED ASSETS ANNEXED TO & FORMING PART OF THE BALANCE SHEET

AS AT 31st MARCH, 2017




Sd/-Saurabh Gupta


Addition Name of Rate of Opening Wdv More than Less than Deletion During Depreciation WDV as on Assets Dep. as on 1.4.16 180 Days 180 Days the Year for the Year 31.03.2017

Air Conditioner 15% 86,599.00 - - - 12,989.85 73,609.15

Furniture & Fixture 10% 168,074.00 - - - 16,807.40 151,266.60

Computer 60% 7,688.00 - - - 4,612.80 3,075.20

Heater 15% 1,804.00 - - - 270.60 1,533.40

Locker 10% 15,377.00 - - - 1,537.70 13,839.30

Fire Extinguisher 15% 4,096.00 - - - 614.40 3,481.60

Mobile 15% 16,349.00 11,998.00 - - 4,252.05 24,094.95

Printer 60% 556.00 - - - 333.60 222.40

Stablizer 15% 5,343.00 - - - 801.45 4,541.55

I Pad 60% 20,623.00 - - - 12,373.80 8,249.20

Telephone 15% - 7,350.00 - - 1,102.50 6,247.50

Total 326,509.00 19,348.00 - - 55,696.15 290,160.85



Notes to the Accounts & Significant Accounting Policies

1. Significant Accounting Policies

a) Basis of Preparation These financial statements have been prepared and presented under the historical cost convention

method on the accrual basis of accounting and in accordance with the Accounting Standards issued by the Institute of Chartered Accountants of India and other generally accepted accounting principles and practices prevailing in India as applied consistently by the Association. However, Subscription is recognised only on receipt basis.

b) Use of estimates: The presentation of financial statements requires estimates and assumption to be made that affect

the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known/materialize.

c) Investments Current investments are valued at lower of cost and market value.

2. Depreciation has been charges on the written down value of the assets as per the rates prescribed under Income Tax Act 1961.

3. Previous year figures have been regrouped or reclassified, wherever necessary, to conform to current year’s classification.

For Chemical & Petrochemical Manufacturer’s Association

Sd/- Sd/- Sd/- President Secretary General Vice President

Place : New Delhi Place : New Delhi Place : New DelhiDate : 19.08.2017 Date : 19.08.2017 Date : 19.08.2017



N O T E S

CPMA

CPMA (Chemicals & Petrochemicals Manufacturers’ Association) is the apex forum in the country representing the Indian Petrochemical Industry. Established in 1993, the Association offers its members a podium to collectively present their ideas, voice their concerns and offer suggestions on industry issues. It provides a linkage between the industry, the Government and the society at large. It is dedicated to the development of petrochemical industry in India and works in close liaison with its members, associated industries, national industry forums (FICCI, CII etc) and Govt of India.

The Association, registered under the Indian Societies Act, is widely recognized by all concerned Ministries / Departments of Government of India. The Association is a Steering Committee Member of the Asia Petrochemical Industry Conference (APIC) which organizes an annual Event by rotation each year in the month of May by its seven nations’ associations namely Singapore, Japan, Malaysia, Taiwan, Thailand, S. Korea and India. India is represented by CPMA at APIC.

CPMA has various sub-committees which are constituted to effectively focus on key areas of each segment of petrochemicals like Polyolefins, Vinyls, Styrenics, Elastomers, Fibre Intermediates and Surfactants. CPMA has also taken the lead to set up and promote the Indian Centre for Plastics in the Environment (ICPE) to deal with all environmental issues connected with the usage of plastics for its sustained growth.

CPMA has a members’ profile which comprises of mainly petrochemical manufacturers’ in public, private & joint sector sectors. List of 22 CPMA members is as follows:

l Chemplast Sanmar Ltd.l DCM Shriram Ltd.l DCW Ltd.l Engineers India Ltd.l Finolex Industries Ltd.l GAIL (India) Ltd.l Gujarat State Fertilizers & Chemicals Ltd.l Haldia Petrochemicals Ltd.l HPCL – Mittal Energy Ltd.l Indian Oil Corporation Ltd.l Indian Synthetic Rubber Private Limitedl INEOS Styrolution India Ltd.l LG Polymers (India) Pvt. Ltd.l MCPI (Materials Chemicals and Performance

Intermediates Private Limited)l Mangalore Refinery and Petrochemicals Ltd.l ONGC Petro Additions Ltd.l Reliance Industries Ltd.l Supreme Petrochem Ltd.l Tamilnadu Petroproducts Ltd.

Associate Members: SABIC India Pvt Ltd

Indorama Industries Ltd and Jindal Poly Films Ltd

About CPMA

Chemicals &PetrochemicalsManufacturers’Association708, 7th Floor, Kailash Building, 26, Kasturba Gandhi Marg,New Delhi - 110001Ph.: +91-11-43598337Fax: + 91-11-43598337Email: [email protected]: www.cpmaindia.com

CPMA

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