Petrochemical industry is highly capital and energy intensive. The adverse tariff regime is one of the primary reasons for inadequate investment and growth in this core sector in India. Rapidly developing countries such as China provide 5.5% tariff differential between Naphtha and Polymers. This has provided adequate incentive for global majors as well as local entrepreneurs to invest in petrochemical plants. Government may consider following duty structure:
Naphtha: from 5% to NIL %, Propane from 5% to NIL Butanes from 5% to NIL, LNG: from 5% to NIL Ethylene from 5% to NIL .Propylene from 5% to NIL, crude from 5% to NIL Aromatics feed stock from 10% to NIL Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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