10 Pakistan Chemical Industry Statistics and Trends

The chemical industry in Pakistan recorded 10% growth during the latest season that statistics are available, with much of that increase because of the popularity of sulfuric acid, which grew at roughly 26%. The industry saw impressive gains with caustic soda (27%) and paints/varnishes (21%) as well.

Much of the performance increases experienced by the industry come from the arrival of new construction activities and commercial operations. This chemical segment is also a significant sector for foreign investors who are interested in Pakistan as a market. With 24 chemical companies listed, there is a primary and secondary chemical industry that each meets specific needs for domestic customers and the export industry.

Over 345,000 tons of soda ash were produced in 2015-16 by the industry, along with 63,000 tons of sulfuric acid, 12,000 tons of chlorine gas, and 681 million grams of polishes, creams, and footwear.

The latest figures published and verified for the Pakistan chemical industry come from the 2015-16 year.

Essential Pakistan Chemical Industry Statistics

#1. There are currently 28 organic compounds, inorganic chemicals, rare-earth metals, and radioactive elements which are part of the export market for the Pakistan chemical industry. India is the primary recipient of these items, with a total value of more than $10 million in 2015-16. Only Afghanistan purchased more than $2 million worth of supplies from the industry during the same year. (Institute of Trade and Competitiveness)

#2. The chemical industry in Pakistan is widespread, with total investment reaching up to Rs. 600 billion in the previous year. Chemicals related to imports for the country represent about 17% of the total imports each year. (Eurasia Review)

#3. Chemical materials are able to be converted into 70,000 different products by the Pakistan chemical industry today, but the level of imports is much higher than what reaches the export market each year. (Eurasia Review)

#4. The total export of chemicals and chemical-related products from Pakistan was worth $170 million at the end of 2010, while imports reached a total volume of $3.9 billion for the year. (Institute of Trade and Development)

#5. The chemical industry received over $253 million in foreign direct investment between 2005-2010 to encourage ongoing growth, helping to create up to 400 specialized manufacturing units for the nation. (Institute of Trade and Development)

#6. Pakistan exports just 36 tariff lines at the HS-6 digit level of Chemicals to India, which offers an average value of roughly $40 million each year. This amount represented 39% of the total export of chemicals worldwide by the industry in 2010. (Institute of Trade and Development)

#7. 54% of the imports of chemicals that come from India involve organic chemicals each year. 10% involve dyeing or tanning solutions, while another 5% of the products are for organic surface-active items like soap. (Institute of Trade and Development)

#8. Pakistan’s primary export from the chemical industry is ethylene dichloride, which represents 47.7% of the overall market. Terephthalic acid provides another 42% of the organic chemicals that went to India in 2010. Roughly 6% was made up of phthalic anhydride. (Institute of Trade and Development)

#9. Over $1 billion of fertilizer products is brought into the country each year as an import by the chemical industry. In 2017, the overall import bill reached $11.3 billion for the first time. (Dawn)

#10. Pakistan lacks the presence of a cracker facility, estimated to cost $6 billion to construction just one of them, which limits their ability to expand. Localized competitors in India and China have combined to build 49 of these facilities in the past 20 years. (Dawn)

Pakistan Chemical Industry Trends and Analysis

The chemical industry in Pakistan is one of the oldest that is continuously operating within the country. When liberalization came in the 1990s, the industry was exposed to international competition. There were reduced roles for the government, insulation with high tariffs, and even intellectual property rights to consider. The industry wasn’t ready for these changes, and so it shifted toward a reduced output for several years.

The Pakistan Industrial Development Council, created in the 1950s, helped to establish the industry in its early years. Now the active corporations that are slowly increasing their capacity for production are helping to stabilize the impact of the industry on the global stage.

At issue with the chemical industry in Pakistan is the fragmentation that is seen in the industry. The country does not have the infrastructure necessary to support a wide-ranging manufacturing system at this moment. There isn’t a facility available to produce the basic petrochemical building blocks that are necessary for downstream materials, which is why imports are relied upon with such regularity.

If the Pakistan chemical industry is ever going to experience success, it must find another significant trading partner in the coming years. Only India provides revenues consistently for this market segment. That is why the country is responsible for just 0.02% of the current production of chemicals in the world today, placing the industry 93rd in total size.