Chemicals to capital goods: What is driving India’s push to indigenise 100 critical items
Indian Express - Explained · Published 8 November 2026 · Last updated
India is accelerating indigenisation of 100 critical chemicals and capital goods to curb China‑led export controls and reduce strategic import dependence.
Key points
- The DPIIT has launched a fresh drive to indigenise 100 critical items spanning intermediates and capital goods, after China announced an export‑licensing regime for key sectors from 18 Nov 2026.
- A tunnel‑boring machine (TBM) plant has been set up in Tamil Nadu and production is slated to start soon, pre‑empting China’s licensing of TBM exports.
- The Ministry of New and Renewable Energy is preparing solar‑module waste‑recycling guidelines following China’s proposed curbs on solar manufacturing technology.
- India’s solar module capacity stands at 233 GW, but cell capacity is only 30 GW and ingot‑wafer capacity merely 2 GW, creating heavy reliance on imported upstream inputs.
- The government is pushing domestic production of petrochemicals such as PVC, LDPE, LLDPE, PP, PS and ABS, plus high‑value imports like phosphoric acid and toluene.
- The Commerce Ministry imposed a minimum import price of $0.766 /kg on PVC suspension resin in August 2026 to protect domestic manufacturers.
- Reliance Industries plans to raise its PVC capacity to 1.5 MMT /yr by FY 2026‑27, while Adani’s Mundra Petrochem Ltd is building a new PVC plant in Gujarat.
- India’s trade deficit with China has crossed $100 billion in FY 2026‑27, prompting a record pace of anti‑dumping actions against Chinese goods.
Background
- In 2024 the Indian government announced a Strategic Materials Initiative to identify and develop domestic alternatives for import‑sensitive items.
- China’s Ministry of Commerce began signalling export restrictions on solar and heavy‑machinery technology in early 2026, prompting Indian strategic reviews.
- The West Asia crisis of 2025 heightened concerns over petrochemical supply chains, leading to early drafts of indigenisation plans for PVC and related polymers.
- India’s Petrochemical Policy 2023 set targets for expanding domestic production of core polymers, but capacity gaps persisted, especially in upstream feedstocks.
- The Rhodium Group 2025 report warned that China’s growing export share would erode trade balances of large economies, underscoring the need for self‑reliance.
UPSC relevance, Prelims facts and Mains angle for this issue are in the full SWAदेSH note.
Original report: Indian Express - Explained