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Periodic Project Review I (PPR I

)
On
Chemical and Fertilizer Industry in Venezuela
Submitted to:
805
S. R. Luthra Institute of Management
Under the Guidance of:
Ms. Parinaz Bharucha
Assistant Professor
Prepared by: Students of MBA (Semester – III)
Group Identify No.GPRN2016VENE80500018
Month & Year: September 2016
Prepared By:
Students

Student Enrolment

Student Name

Registration No
SRN201680500798
SRN201680501141

No
158050592075
158050592088

PATEL PRACHI
RINCY THOMAS

SRN201680501144
SRN201680501184
SRN201680501238
SRN201680501251

158050592089
158050592096
158050592103
158050592106

RISHI PATEL
SHARON RAJU
SONI RUCHI
SURATI
BHAVINKUMAR

CGBS-PROJECT REVIEW SYSTEM (PRS) for GCSR –
Semester III
PERIODIC PROJECT REVIEW (PPR - I)
PPR - 1:
S.
N
o
1

2

3

Particulars

Worked by
(Student
Registration No)

About selected Country
 Overview – Geographic location,
SRN201680501251
languages, currency & exchange
rate, religions, flag, national
anthem, ruling party etc.
 Latest news/ developments in
the country
Overview of Industries, Trade and
Commerce in the Country of study
SRN201680501184
 List of Industries
 Contribution of industries in
national GDP
SRN201680501144
 Export-Import statistics
 Major players of each industry
SRN201680501141
with their market share
 Details of selected industry w.r.t.
Gujarat: Brief about subsegments of the industry/
sector,
 Contribution of selected industry
in national GDP,
SRN201680500798
 Major players of selected
industry and its sub-segments
with their market share,
 Local taxes and duties
applicable in selected
industry/sector, any special
benefits given by state
government to the industry
About selected Industry / Sector
SRN201680501238
of country of study
 Overview of selected industry
 Justification for selecting the
Industry / Sector in terms of

bilateral trade opportunities with
India/Gujarat (Literature review
from published reports, Ministry
of External affairs, National /
International repute
organization or any other
authentic sources for selecting
industry/ product/ sector, List of
Web sources/ References)

1. About Venezuela
1.1 Overview
Venezuela, sixth largest country in South America as well as the
sixth-most populous country in Latin America with population just
over 900,000. It is located at the northern extreme of South
America. The country is divided into 23 states including Caracas as
capital. There are fine stretches of the Andes, huge areas of
Amazonian rain forests, fertile plains called Ilanos, miles of
Caribbean shoreline, and even a small desert. The country is gifted
by few geographical superlatives, like the world’s highest waterfall
and the largest lake in South America.
Figure 1 Map of Venezuela

1.2 Geography
Venezuela is third larger country then Texas and located on a most
occupied northern coast region of Caribbean Sea which is 2800 kilo
meters in South America. It is surrounded by Colombia up to west,
Guyana to east side and according to south up to Brazil. Venezuela
is having an area of total land 882,050 square km which is about
twice the size of California.

An Orinoco plain called as llanos. the Spanish verb conjunction is much easier than others. accounting for nearly half the national territory. 3. the rich and fruitful agricultural land and significant petroleum deposit. The high mountains have peaks is over about 4500 meters and all the fertile valleys between the ranges contain most of Venezuela’s people. Hence. the area was still thinly populated in 1990. 1. There are approx. south of the Orinoco. . Overall area is flat with only slice slop to the center and little bit away from the mountains that surround the region. Maracaibo lowlands in the northwest The low land is bordered by mountains on three sides and open to the Caribbean sea to at the north. There is some heterogeneity in the nature of Spanish language with respect to Venezuela like Spain. Northern mountains extending in a broad east-west arc from the Colombian border along the Caribbean Sea.Venezuela is divided fairly into four regions: 1. As there are less irregular verbs. which extends its boundary towards westward from the Caribbean coast to the Colombian border in-between the northern mountains and most extreme side of Río Orinoco. 2.3 Languages Spanish is an official language of the republic of Venezuela. Wide Orinoco plains (llanos) in central Venezuela and the highly dissected Guiana highlands in the southeast. The Guiana Highlands. 4. 31 primitive languages where 25 of them can be grouped into seven lexemic families and rest other is unclassified.

Their currency rankings conclude that exchange rate of VEF to USD rate is most popular ever. 1000 Bolivar Bolívar is a currency of Venezuela. About 8% are Protestant where rest comes into another religion. to 100 per dollar in September 2014 which was historical drop of currency with respect to Venezuela according to Dollar today. There is small Jewish and Muslim community across 23 states of Venezuela including capital CARACAS. The highest value of bolivar against US dollar ever was 9. 1. Bolivar dropped approx.5 Religion Venezuela’s population is mostly roman and It’s estimated that above 90% population are Roman Catholic according to religion.94 bolivar per USD. and the currency symbol is Bs. 1.4 Currency Figure 2.6 Flag Figure 3 Venezuela's Flag .1. The currency code VEF is represent bolivar. or are atheist.

. These stars are for Caracas. Yellow indicates the wealth of country. Moreover these three colors have different meaning like red color represent courage of Venezuelan and the blue color represents the independence from Spain. Margarita. 1. Cumana. Vice-president Jorge Arreaza.The horizontal tri-color flag was waved in March 12. Mérida and Trujillo and the eighth star is the Bolívar Star. 2013. was included in 2006 to Honor Simon Bolivar.10 National Anthem When Venezuela’s independence had declared. the current president Nicolas Maduro from April 19. Barcelona. 1. 2006 and designed by Francisco de Miranda which include traditional emblem and eight five pointed stars in it. and another 29-member national board of directors. Spanish firing squad wrote the anthem for the republic of Venezuela in 1814 which known as Venezuelan Marseillaise and as well as Gloria al Bravo Pueblo (Glory to the Brave People). The party is headed towards national level by the eternal President Hugo Chavez (14 April 2002 – 5 March 2013). Barinas.11 RULING PARTY Venezuela is being ruled by the United Socialist Party of Venezuela which supports Bolivarian revolution with Participative Democracy that too with Presidential System.

Venezuela’s president announced 2016’s new minimum wage rate. 4. a. a.1. The first face of this mining project has been started in September month itself. a. In addition moduro said it’s about to protect population against the economic war carried out by the world. It declared that the development of mining project is under strict adherence of Venezuelan environmental norms. Hundreds of thousands of people joined as opposition while Nicolas Maduro currently president told a big rally of supporters: “Today we have defeated a coup attempt “ 2.051 bolivars.12 LATEST NEWS 1. b. $USD28. Venezuelans throng streets of Caracas capital of Venezuela seeking recall referendum for president. According to one of the reports published by ABC news: Venezuela is facing hard time against the hunger and poverty people are going throng on the street and president claimed that Venezuela is failed country in Latin America.576 bolivars in $USD 35. It describes overall position of state and government of current scenario 3.90.40 with a food bonus equal of 18. The amounts is about to increase to 22. Moduro said recent minimum wage of Venezuela is 15.480 bolivars in $USD 66.06 respectively. b. . and the equivalent of $USD 23.585 bolivars or. As per news by vanazuelanalysis: Venezuela is taking a step ahead with new mining development. a.11 and 42.

1 List of Industries Automobiles Venezuela is the 4th largest in the Latin America. after Brazil. Overview of Industries. It is also amongst world leaders in hydroelectric production that suppling majority of the nation’s electrical power through the process. Argentina & Mexico and also it is the 36 th largest Worldwide in automobile business.2. Energy Venezuela has proved to be the world’s biggest reserves in 2014. Most of the companies have stopped its operations due to the difficulty in obtaining dollar denominated auto parts using Venezuelan monopoly money. The country's poor business environment will keep investment and productive capacity subdued in the short term. It has the largest . Petrochemicals Venezuelan is the country which have maximum potential for producing petrochemical to the range that they are currently constructing eight large petrochemical facilities and one of which is built with the support of Belarus to exploit phosphoric rock and convert it into fertilizer.161 automobile in the first part of year. In 1970s & 1980s production of vehicle was between 150-200 thousand per year of mostly US developed vehicles. Venezuela's pharmaceutical market is expected to grow at doubledigit rates through to 2025 in local currency terms. producing only 6. Then in 2014 the auto industry collapsed. though largely due to hyperinflation. Trade and Commerce in the Venezuela 2. About 1/3rd of the country‘s GDP and 50% of the Govt’s revenue and 80% of export earnings of Venezuela. Healthcare Venezuela has improved which ranks pharmaceutical markets according to their attractiveness to international drug makers.

Venezuela has a road network around 100000 Km (placing 47th in the world) and around 3rd of roads are paved (cemented). Transportation Venezuela has a limited National railway system that has no active rail connections to other countries. oil and state controls most of the country’s vast mineral reserves. a Canadian mining company the government entered into a joint venture to exploit the Brisas and Las Cristinas goldmines. Mining Sector Venezuela is known as producer and exporter of minerals such as bauxite. As a part a of it now in 2016 settlement of a dispute over withdrawal of a gold concession to Gold Reserve.2 Contribution of industries in National GDP (2015) . coal.conventional oil reserves and 2nd largest natural gas reserves in the Western Hemisphere. because of difficulty in converting bolivars to other currencies many international airline either cut back or entirely cancelled its service to the country. In 2014. gold. iron ore. 2. In the Orinoco Arc and other areas Venezuela has the 2nd highest gold reserves in the world.

com/basicfacts .Manufacturing sector 17% Agriculture 3.5% Healthcare 4.9% Mining 13% 12% Oil Sector 1.6% Tourism and Ecotourism Sector Source: https://venezuelanalysis.

focus-economics.com/countries/venezuela .http://www.

97 USD Bn in 2014 and decreased to 8.Source: http://www. reaching an alltime high of 509.tradingeconomics. 2.61 USD Bn in 1960.com/venezuela/gdp The GDP of Venezuela was worth 509.51 USD Bn from 1960 until 2014.3 Economy of Venezuela . The GDP value of Venezuela signifies 82% of the world economy.97 Bn US Dollars in 2014. GDP is averaged to 98.

70% $569.20% $74.20% 7% 8.10% -60.51 bn $15.50% - Exports - Imports Reserves for Foreign Exchange & Gold Exchange Rates – Bolivars per US dollar - Stock of FDI –Abroad - Stock of FDI.71 bn $33.000 GDP (Official Exchange Rate) GDP.6 bn 1.9 $515.7 bn bn bn 22.41 bn 6.Real Growth Rate - - GDP (PPP) Gross National Saving Unemployment Budget Surplus(+) Deficit (-) Inflation Rate for consumer Items $16.284 $27.84 bn Figure 5 The Gross Domestic Product (GDP) in Venezuela .17 bn $58.2013 2014 GDP Per Capita (PPP) $19.284 62.44 bn 6.1 $546.09 bn 121.700 $239.74 bn $58.20% 15.30% 12.284 $29.53 bn $47.Home 2015 6.30% -3.90% -5.36 bn $22.000 $18.70% $47.

tradingeconomics. The GDP value of Venezuela signifies 82% of the world economy.com/venezuela/gdp The GDP of Venezuela was worth 509. .Source: http://www.97 Bn US Dollars in 2014.61 USD Bn in 1960.97 USD Bn in 2014 and decreased to 8. GDP is averaged to 98. reaching an alltime high of 509.51 USD Bn from 1960 until 2014.

290 for every person in the country–cut almost in half from comparable statistics for 2014.5% 1. Brazil to its south and Colombia to its west.4 Export-Import statistics A federal republic on South America’s northern coast. Venezuela is highly dependent on its oil exports which dominated 90.1 billion as of April 2016. Using the latest GDP numbers. slag. Venezuela is bordered by Guyana to its east. Based on statistics from the International Monetary Fund’s World Economic Outlook Database. Venezuela is particularly vulnerable to the global downswing in oil prices.4% metals Organic chemicals Iron and steel Ores.9 billion in 2015. That metric represents 7.1% 1% .4 million 419.4. Product name Oil Gems. ash 583.3million 375.1 million % 90.4% since 2011.6million 1. Therefore.9 billion in 2015 Venezuelan exports represents roughly $1.3% from 2014 to 2015.1% deterioration from 2015. 82. down -58. Also shown is the percentage share each export category represents in terms of overall exports from Venezuela.6% 2.6% comprised of refined petroleum products including gasoline.2. Year over year. exports during 2015 account for about 7. Exports from Venezuela sank to an estimated US$37.4% of its petroleum exports are crude oil with the remaining 17. Venezuela’s total Gross Domestic Product was $479. Given Venezuela’s population of 29. 2.3 million people. the value of Venezuelan exports fell -46. precious Export in US$ 343 billion 922.com. the estimated $37.9% of total Venezuelan economic output.1 Venezuela’s Top 10 Exports The following export product groups represent the highest dollar value in Venezuelan global shipments during 2015.6% of the country’s total product shipments. according to WorldsRichestCountries.

6% for the 5-year period ending in 2015.4%. Venezuela exported $63B and imported $36.71B). unwrought or semimanufactured gold led the gems and precious metals category to its 4. followed by the ores.4% over the same period.3million 81. In 2014. Electronics exports improved by 104.8B).6% 0.8million 223.4% 0. Oil was the big loser among Venezuela’s top 10 exports. Acyclic Alcohols ($606M). Gold ($580M) and using the the 1992 classification. In second place was fish up 484.9B). Iron and steel exports depreciated by -57. are Crude Milk ($776M) .6B. slag and ash category which dropped by -34. The organic chemicals product category appreciated by 234. (Harmonized imports System) are Refined Medicaments ($1. Frozen Meat ($1.7% 0.Packaged Bovine of top Petroleum HS Coke ($425M).8milllion 53million 0.Concentrated and Corn ($726M).1% Among the top 10 Venezuelan exports above.3B.6million 146. Venezuela is the 51st largest export economy in the world.07B). Refined Petroleum ($10.2% from 2011 to 2015.2% 0. resulting in a positive trade balance of $26.Aluminum Inorganic chemicals Fertilizers Fish Electronic equipment 261.94B). The top exports of Venezuela Petroleum ($47.9%. down by -61.712% value gain since 2011.8% while shipments of inorganic chemicals moved ahead by 46.6%. revision Its Petroleum ($2.

22 in 12 months’ time. we estimate Exports in Venezuela to stand at 8938.37 USD Million by the end of this quarter. Looking forward.Figure 6 Export destination Source: From Atlas Media Forecast of Export Exports in Venezuela are expected to be 8730. In the long-term. according to our econometric models.97 USD Million in 2020. the Venezuela Exports is projected to trend around 11229. Actual and future forecast Forecas Actua Q3/1 Q4/1 Q1/1 Q2/1 2020 Unit t l Exports 8483 6 8670 7 8960 7 8940 1120 USD 6 8730 0 Source: From Trade Economics Million . according to Trading Economics global macro models and analysts expectations.

68%. August 25.Figure 8 Exports in Venezuela Source: From Trade Economics Venezuela Exports Forecasts are projected using an autoregressive integrated moving average (ARIMA) model calibrated using our analysts expectations.6b.03% of the total imports of Venezuela.2%. We model the past behaviour of Venezuela Exports using vast amounts of historical data and we adjust the coefficients of the econometric model by taking into account our analysts assessments and future expectations.6b in 2014. . followed by packaged medicaments. making it the 60 th largest importer in the world during the last five years the imports of Venezuela have decreased at an annualized rate of -1. from $38.4. 2.8b in 2009 to $36.3 Import In 2014 Venezuela imported $36.was last predicted on Thursday. The most recent imports are led by refined petroleum which represent 8. The forecast for Venezuela Exports . 2016. which accounts for 4.

Imports in Venezuela are reported by the Banco Central De Venezuela.13 USD Million from 1992 until 2015. Actual and future forecast Forecast Actual Q3/16 Q4/16 Q1/17 Q2/17 2020 Unit Imports 9576 9580 10100 10100 10100 13400 USD Million Venezuela Imports Forecasts are projected using an autoregressive integrated moving average (ARIMA) model calibrated using our analysts expectations. We model the past behaviour of Venezuela Imports using vast amounts of historical data and we adjust the coefficients of the econometric model by taking into account our .Figure 9 Import origins Source: From Atlas Media Imports in Venezuela increased to 9576 USD Million in the third quarter of 2015 from 8778 USD Million in the second quarter of 2015. Imports in Venezuela averaged 6811. reaching an all time high of 17841 USD Million in the fourth quarter of 2012 and a record low of 1970 USD Million in the third quarter of 1994.

The forecast for Venezuela Imports . August 25.4 Trade balance As of 2014 Venezuela had a positive trade balance of $26.was last predicted on Thursday. Figure 11 Trade Balance of Venezuela Source: From Atlas Media .3b in net exports. As compared to their trade balance in 1995 when they still had a positive trade balance of $2.analysts assessments and future expectations.4. 2016. Figure 10 Import origins 2.54b in net exports.

http://focus2move. the nation was burdened with high inflation and foreign debt. is known for its bountiful petroleum wealth. During this period. recovered steadily and is still the richest nation in South America. nevertheless. when the Venezuelan petroleum industry suffered as a result of declining oil prices. The nation went through significant economic turmoil during the 1980’s. Venezuelan Automotive Industry Source: . The Venezuelan economy has. once predominantly an agricultural economy.Major Player of Industries with market share Venezuela. the load of which spilled over to most of Venezuela’s industry sectors.com/venezuela-automotive/ Venezuelan Petrochemical Industry .

slag. precious metals 2. Shown is the percentage share each industry category.5% Iron and steel 1.67 million labor force. ash 1% Aluminium 0.4% Fish 0. accounting for employment of about 23% of its 12.http://www. The status of some major players in the Venezuela industry sector presently is as follows: Industry name Share% Oil 90.6% Gems.http://blogs.com/venezuela/ .platts.1% Ores.2% Electronic equipment 0.1% Source: .Source: .4% Organic chemicals 1.6% Fertilizers 0.com/2016/06/29/latin-americapetrochemical Venezuela Industry Sectors: Major Players The Venezuelan industry sectors play a major role in the nation’s economy.tradeineconomics.7% Inorganic chemicals 0.

Domestic demand of specialty chemicals is probable to follow an accelerate growth path. Major resources produced by the state include manganese. chemical drugs ceramics gems and jewelry etc. over the past five years and become one of the most industrialized states of India. It currently stands at $21. This demand is mostly driven by the strong development viewpoint for end use industries. Gujarat maintain variety of industries. agate etc. limestone. having a per capita GDP significantly above India’s average . engineering. fertilizers and chemicals. This along with . lignite. Gujarat state Domestic Product rising at an average growth rate of 14 % per annum (2002). like general and electronically engineering. Annual growth rate of Gujarat over 10% p.3 of GDP growth rate 12% over the last five years. textile.Overview of Chemical and fertilizer industries in Gujarat Gujarat is one of the most industrialized state of India. It is one of the most prosperous states.2-1. bauxite.Gujarat become a leader in various industrial sectors like textile.a. Gujarat’s Chemical industries count for more than 35 % of Indian chemical production. Gujarat accounts for 16% of the nation's industrial production and 22% of its exports Chemical industry is one of the knowledge driven industry and that has been growing rapidly at 1.5 billion.

Indian players should come in concert and proactively work towards shared investment to avert global struggle.increased acceptance of specialty chemicals and newer applications can drive the development further. superior operational costs. skilled manpower. Indian chemical sector is very critical for the economic development of country. old-fashioned technology/process. Global chemical market size was predictable at $3. Chemical industry is an investment as well as knowledge demanding industry.6 trillion in 2011 and is likely to grow at 4-5% every year over the next decade to reach $5. The domestic specialty chemical producers currently face challenges related to feedstock accessibility. Advantage of Gujarat State Gujarat has grown to be one of the most preferred locations for industrial investment in India. Apart from having sound infrastructure facilities. It accounted for 13% of the total India's export. It accounted for 13% of the gross value added by the industry sector.3 % of the total chemical market with a market size of $ 0. excellent domestic and international connectivity and availability of raw materials. . Apart from relay on regulatory interventions.000 commercial products.1 trillion in 2011. Indian chemical industry is also a much diversified industry with more than 70. India currently knows for only 3. The figure below lists the map & key parameters of Gujarat. a key differentiate factor for Gujarat is its focus on industrial development in the state. limited speculation in R&D & a off-putting perception amongst end customers.8 trillion by 2021. It has evolved as an urbanized economy ensuring easy off-take of industrial output.

Gujarat is also the largest exporter of cotton (60 %) in the country. naphtha. Gujarat Alkalis & Chemicals Ltd. The Cluster Development Scheme has been launched for furthering the growth of product clusters. The total cargo managed by the Kandla Port (Only Major port of Gujarat) was 82. salt. Around 6. Gujarat has 184 industrial estates established by the Gujarat Industrial Development Corporation (GIDC) for specific sectors such as chemicals. Gujarat has 83 product clusters (refer figure below). oil cakes.5 million tones during 2011-12. Pet-cock etc. The chemical and petrochemical industry in Gujarat is the fastest growing sector in the state's economy. Gujarat State Fertilizers & Chemicals Ltd. (GSFC). bauxite. The State Government has taken care to set up industrial estates on nonagricultural land after assessment of industrial viability. clinker. chemicals. electronics. fish processing cluster at Veraval and power-looms cluster at Ahmedabad. (GACL) and Gujarat Narmada . apparels and granite.Gujarat contributed 24. petroleum. and contributes significantly to the country's petrochemicals production (62 per cent). Some of the successful clusters include ceramics cluster at Morbi. Currently. food grains. Gujarat is the 'Petro Capital' of India. Exports include products from sectors such as textiles. gems and jewellery. brass-parts cluster at Jamnagar. cement. Gujarat houses production facilities for some of the largest global and Indian chemical and Petrochemicals manufacturers. pharmaceuticals.34 million MSMEs.600 chemical and petrochemicals products are produced in the state. ethylene. The industrial infrastructure of Gujarat is very supportive for business development. Such availability of product cluster ensures opportunity across the value chain. paraxylene.6% to India's total exports of goods in 201011. gems. chemicals production (51 per cent) and pharmaceuticals production (35 per cent). cement clinker. petrol. engineering.Gujarat has truly emerged as the hub of chemical manufacturing in India. soda ash. The state's manufacturing industry is supported by 0.

One of the key segments of specialty chemical is . Its urbanization has increased from 37% to 43% in last decade. Leading Indian and multinational private organizations which have a footprint in Gujarat are Reliance. Specialty chemicals in Gujarat For the growth of any specialty chemicals company two aspects of value chain are very critical: i ii Need & presence of end consumers Availability of feedstock Amongst all states of India.Valley Fertilizers Company Ltd. BASF. Gujarat output with accounts more than for ~35% 3200 of India's pharmaceutical companies located in the state. Rallis. Gujarat is one of the fastest growing states in terms or urbanization. Aarti Group and Deepak pharmaceutical Nitrite. Dow Chemicals. GACL is the market leader in caustic soda whereas GNFC is one of the leading fertilizers company in the country. Cadila. a large number of domestic and multinational companies across various chemical segments have presence in the state. This makes Gujarat market a ripe market for consuming specialty chemical products. As explained earlier. Essar. Gujarat accounts for 5% of total population whereas in terms of urban population its share is 7% (2% higher than share of overall population). Cheminova. More than 35% of large & medium units in the state are from chemical industries and chemicals account for ~16% of employment in the state. Lanxess. Apart from these 3 PSUs. The demands of these urban users are more towards performance & high value added products. (GNFC) are the largest public sector units located in Gujarat. ONGC. Bayer. Nirma. GSFC is the only producer of melamine and largest producer of caprolactum in India. India Oil (IOCL). Indian Petrochemical Corporation Limited (IPCL). Novartis.

Being an industrial state the perception of chemical industry is not so bad in Gujarat. Another example for the site specific need of Gujarat is for water treatment chemicals. as the fragmented structure of specialty chemical producers does not guarantee a regular off take for crackers.agrochemicals. Gujarat is likely to overcome this hurdle also. However the challenge for the availability still remains. based on favorable investment policies of govt. in the past. Apart from these another major hindrance for growth of specialty chemical is technology. For feedstock availability. The presence of downstream industries is huge. This has increased the significance of water conservation & hence increased the scope of water treatment chemicals. And with RIL& OPaL crackers the availability of raw materials should not be a major concern. The entrepreneurial spirit of Gujarat is well acclaimed & hence a lot of small & medium enterprises could also be found here. Gujarat accounts for 10% of the total industries in India. Gujarat as a state faces food security challenge. In addition Gujarat govt. The level of R&D in Gujarat is limited (in comparison to India it is still better). Gujarat alone accounts for more than 40% of the refining capacity in India. Gujarat is an industrial state with the water availability already in scarce zone. And hence the need to increase the yield is quite high. promoting industry academia linkages. This makes it a good focus market for agrochemicals. has planned effectively in recent past to ensure environmental safety & communication of the same to its citizens. However going ahead with many foreign MNCs increasing their presence & govt. Existing Major Payers of Gujarat 1 Reliance Petrochemical Complex . This makes feedstock for specialty chemical a low priority in their product portfolio.

6 billion).963 crores ($6. Urea. Reliance reported that their total sales were Rupees 30.83 lakh MT achieved in 2013-14. SSP & MOP. However. Reliance Industries suggested at that time that it would be willing to spend $2. this gap has been bridged by increased volume of domestic trading of Fertilizers e. along with capacity at another site in Hazira. petrochemical complex saw major capacity The Jamnagar expansions in polypropylene and paraxylene by 2008. This refining plant alone has a capacity of 27 million tone per year and the PP plant is exported to 30 countries. in line with last year.5% of GDP.73 Lakh MT during 201415 from that of 13. 2 Gujarat State Fertilizers and Chemicals Limited Gujarat State Fertilizers and Chemicals Limited had been established in 1962 and have made an exceptional contribution towards the progress of the Indian fertilizer industry.5 to $3 bn in order to increase its Jamnager petrochemical complex. India.76 lakh MT). . In spite of below average monsoon in 2014. Sale of Gujarat State Fertilizers and Chemicals Limited has marginally declined by less than 1% to 13. RPL is the part of RIL which was merged with RIL in 2009 and was set up to harness value in global refining sector. contribution of home state of Gujarat (primary market) in aggregate fertilizer sales of the company has been maintained at 49% (6.Reliance Industries Limited’s refinery and petrochemical complex is located as PP (polypropylene) capacity at the Jamnagar site.g. The multiplier effect is expected to put the increase at around 6.

Chemicals/Petrochemicals.53 Cr to Sales Value (28. Gujarat in 1976. GNFC has an enterprising. GNFC today has extended its profile much beyond fertilizers through a process of horizontal integration. Energy Sector.03% .Figure name: Chemical and Petrochemical Cluster Source: Industry Commisionerate Government of Gujarat 3 Gujarat Narmada Valley Fertilisers & Chemicals Limited Gujarat Narmada Valley Fertilizers & Chemicals Limited (GNFC). is a joint venture enterprise between the Government of Gujarat and the Gujarat State Fertilizers & Chemicals Ltd. Gujarat Narmada Valley Fertilizers & Chemicals Ltd. strategic view towards expansion and diversification.(GSFC) and located at Bharuch. key Products/Revenue Segments include Fertilizers which contributed Rs 1383. Electronics/Telecommunications and Information Technology form ambitious and challenging additions to its corporate portfolio. .

5 to 7 per cent for the next five years. started in October 2014. They are certified with ISO 9001:2008. Gujarat.84 Cr to Sales Value (12. such as polyetherols and polyesterols. They invest $180m which is biggest investment made by BASF in India. BASF continuing with the country's GDP registering a growth of 6. and other polyurethane products applied primarily in cold and heat-insulation applications. which is managed by Gujarat government. Sales of GACL was rose 9. GACL is the single largest producer of Caustic Soda in India. BS OHSAS 18001:2007. Limited BASF SE (Baden Aniline and Soda Factory Societas Europaea) is the largest chemical producer in the world and is headquartered in Ludwigshafen. 1973 in the State of Gujarat by Gujarat Industrial Investment Corporation Limited (GIIC). Our QHSE En policy reflects our emphasis and commitments.53% of Total Sales) 4 BASF Styrenics Pvt. The plant also integrates production facilities for precursors.21 crore during the previous quarter ended June 2015. Cellasto microcellular polyurethane components for automotive NVH (noise.06% to . with a production capacity of 1087 TPD. and an MDI (methylene diphenyl diisocyanate) splitter. ISO 14001:2004. 5 Gujarat Alkalis and Chemicals Ltd Gujarat Alkalies and Chemicals Limited (GACL) was found on 29th March. the first of its kind in South Asia. By-Products & Others which contributed Rs 618. Net profit of GACL rose 95.26 crore in the quarter ended June 2016 as against Rs 44.of Total Sales). vibration and harshness) parts. for processing crude MDI. ISO 50001:2011. Germany and India's chemical production complex at Dahej.11% to Rs 86. The polyurethane plant produces BASF's proprietary Elastollan thermoplastic polyurethane (TPU).

'B'.56 crore during the previous quarter ended June 2015. professionally managed business group. GFL has a well-established diverse portfolio of chemicals catering to a broad range of industries.Rs 515. 7 Gujarat Fluorocarbons Ltd Gujarat Fluorochemicals Limited (GFL) is a part of the $3 billion INOX Group of Companies. 6 Gujarat Chemical Port Terminal Company Ltd Gujarat Chemical Port Terminal Company Limited (GCPTCL) is located at Dahej. In a short span of 6 years. and 'General' classes. with market leadership in diverse businesses including Industrial Gases.5% in 2015-16. GCPTCL shown that their sustained growth of GDP over the last few years was 6.38 crore in the quarter ended June 2016 as against Rs 472. This location gives GCPTCL the leverage of pleasing proximity to the production facilities of oil. IPCL put up its Gas Cracker complex at Gandhar / Dahej. it has grown to become a highly integrated and technologically advanced chemical complex . Refrigerants. Later M/s. Their GDP growth rate was rose to 7. INOX Group is a family owned. Renewable Energy and Entertainment. The development of the area received a boost when sizeable reserves of gas and oil were found in the area. Chemicals. Gujarat. GFL’s Chemical Division combines chemistry and innovation with the principle of sustainability to address diverse needs of industry. District Bharuch.000 DWT to 60. GFL’s chemical complex commenced operations in the year 2007 at Dahej. Over a period. petroleum products & chemicals. Cryogenic Engineering.000 DWT and the present Storage Terminal capacity is about 300.9%. The Port is capable of handling vessels of 6. Gujarat. the idea of developing a Port in Dahej region took shape and Gujarat Chemical Port Terminal Company Limited (GCPTCL) was conceived.000 cubic meters of hazardous liquid & gaseous chemicals falling in 'A'.

10. High productivity and profitability transformed Gujarat Industries to a joint stock company. Gujarat Industries Ltd was found in 1986 as a partnership firm in Gujarat to manufacture pigments.500 tpa Chloromethane plant. They have four multifunctional production facilities in Gujarat (India) of which three are ISO 9001-2000. More than 80% of our pigment products and over 50% of our pesticides products are exported the world over. 8 Meghmani Chemicals Ltd. strong presence in the domestic market and a focused management team has seen Meghmani Organics Limited grow at a compounded annual growth rate (CAGR) of 17% and profits 10% over the past 3 years. Since then Meghmani Organics Limited has diversified its business interests to include a range of pesticides and other pigment products as well. Sound fundamentals. and combined coal and gas based captive power plant with a capacity of around 90 MW.which comprises of a 1. under the name of Meghmani Organics Limited. by 1995.000 tpa Caustic Soda / Chlorine plant. . Their production facilities are strategically located with high accessibility and close proximity to source of raw material. a 87. outstanding export performance.

and beyond. Entrepreneurs do not know about collateral free loan providers. the .  The US oil companies determined how much oil they would take and what they would pay. the chemical manufacturing sector has emerged as a key economic activity in the country. These were four decades in which much of the prosperity of the United States was achieved by importing raw materials from South America at bargain basement prices. On account of its wide-ranging application. They ran the oil drilling operations and the export sector.  According to Bolivarian Revolution Venezuela is important to the United States because it is a major oil supplier and because it is a relatively close neighbor that is exercising considerable influence in Latin America. The weak point is that they do not have adequate funds. 2 Chemical industry in Venezuela Highly intelligent and skilled manpower can perform skilful manual operation for producing good quality items. the Caribbean.3 About Chemical And Fertilizer Industries of Venezuela 1 Chemical Industry Chemicals are one of the key input materials that are used across wide ranges of industry and consumer sector. The opportunity for doing a business in Venezuela that is Venezuela government encourages companies by granting vivid types of concessions. In the early 1990’s. For doing a business in Venezuela the rules and regulations are strict and most of products depend upon imported raw materials so large scale disruption may affect local production.  Venezuela on the other hand was almost completely dependent on imported products and technology.

More than 57% (4. and 70 companies account for 70% of total sales. 82% of exports go to North and South America. Petrochemicals represent 70% of chemical exports. with growth driven by the availability of raw materials from the country’s oil and gas industry sector. that the country should produce its own food. just 15 of them account for 62% of turnover.  The Bolivarian revolution has introduced a string of social programs and reforms designed to deepen and extend social democracy. As of October 2015. and represent 22% of all Venezuelan non-oil exports. 65. Its agricultural reform is 'based on the premises that farmers should have control of their land and product.International Monetary Fund (IMF) and the World Bank pressured Venezuela to accept Washington's 'consensus' on free trade.9 billion with petrochemicals accounting for 60%. 2010). While there are more than 350 chemical companies.97 million) of chemical munitions and containers have been destroyed. 3 Chemical industry in India India is the third largest producer of chemicals in Asia and sixth largest in the world. Since 2001 ‘the government has expropriated (with compensation) some three million hectares of land. Output of the Venezuelan chemical industry represents 10% of the country’s total GDP. The global chemical market is valued at around USD 3. Products fall into three main sectors: basic petrochemicals. Estimated at a market size of USD 139 billion in FY .524 (90%) metric tonnes of chemical agent have been verifiably destroyed. Exports account for 38% of the chemicals turnover figure.720 of 72. and that chemical fertilizers and pesticides should not be part of agriculture' (Broughton. intermediates and consumer products.6 trillion. and has issued permits to tens of thousands of families to work a total of two million hectares’ (2010). Total sales for 2015 reached $5.

In chemical industry.308 Thousand Metric Tonnes in 2015-16.51% of the GDP and 15. The diversification within the chemical industry is large and covers more than 80. contributing 2. Export from a significant part of the sector and account for 9% of total value of exports in the country. Skilled human resources are also available. Manufacturing of chemical is concentrated in several industrial clusters across the country with those in Gujarat and Maharashtra being the most prominent. The Indian chemical sector is one of the strategic industrial sector in the country.000 commercial products. The threats for the chemical industry large government support are also enjoyed by Chinese companies. the Indian Chemical Industry is expected to grow at 9% annum to reach USD 2015 billion by 2019. Australia. North America. But the weak point is that many allegations of labour strikes due to unchanged wage patterns. that is research and development base is relatively weak. The opportunities for doing a business in India is special economic zones and PCPIR (petroleum chemicals & petrochemicals investment region is also developed. The total production of the Indian chemical industry was 21. parts of South-East Asia and China.95% of the country’s manufacturing sector GDP. In India matured industry which is understand the specification of foreign buyers.2015. The weak point is that. The opportunities for doing business in Gujarat is that there is large scale investment in chemical industry so market share is also expand But the threats for The chlorine industry is in a decline stage due to alternate chemicals and cheap resources. Middle East. 4 Chemical industry in Gujarat Gujarat exporting chemicals in regions of Europe. it develops specialized chemical with low capacity plants. .

Venezuela. via a joint venture with two other companies. though. Pequiven. both directly and indirectly. over the past five years and is one of the most industrialized states of India. petrochemical production would increase from 11. engineering. It accounts for 16% of the nation's industrial  production and 22% of its exports. which produced petrochemicals under the auspices of the state oil company PDVSA.000 new jobs during that time. By Gregory Wilpert . Gujarat state Domestic Product rising at an average  growth rate of 14% per annum (2012). Gujarat established itself as a leader in various industrial sectors like textile. June 27. such as tires or agriculture.5 to 25 million tons per year in the next seven years. having a per capita GDP significantly above India’s average. but all of this fertilizer is exported. Many of the jobs would be created because Venezuela would provide an impulse for the country to build up its own industries  that depends on petrochemicals. whose goal is to double Venezuela’s production of petrochemicals in the next six years and to  eliminate Venezuelan dependence on fertilizer imports. Chemical industries in Gujarat count for more than 35% of Indian chemical production. fertilizer. all for Venezuela’s domestic market. propylene.a. According to the plan. Gujarat has achieved an annual growth rate of over 10% p. the industry should create about 700. is to produce PVC. Also. and other chemicals. while the country’s agricultural sector has to import fertilizer. Venezuela’s Pequiven currently produces fertilizer. 5 Fertilizer industry in Venezuela . chemical drugs ceramics gems and jewelry etc. The plan for the new company. 2005— Venezuela launched a new state-owned petrochemical company over the weekend. had exported most of its products.Caracas. It is one of the most prosperous states.

S. according to a World Bank report. and China. and phosphate fertilizers (including ground rock phosphate). yucca.69 in 2015. May 28th 2009 to strengthen Venezuela's agricultural sector. Forestry and Fishing Sector and Banking Sector. The two governments also signed agreements to help promote the production of citrus fruits. According to Merida.  The Fertilizer consumption (% of fertilizer production) in Venezuela was 86. The opportunities for doing business in Venezuela are that the customers are not yet conscious about consumer rights. Few other major sectors exist in Venezuela like Energy Sector. potash.  Venezuela became an important source of oil for India over the past decade. because West Asia is India’s primary source of oil. But the weak point is that entrepreneurs do not have adequate funds so they don’t know about loan providers.Producing fertilizers need measuring and calibration equipment which are expensive if imported. When U. production of domestic shale oil increased. Fertilizer products cover nitrogenous. and coffee on family farms in Venezuela. Traditional nutrients--animal and plant  manures-are not included. Diversifying its import sources became important in the wake of the Arab uprisings. Expertise to develop such equipment at low cost exists within the country. may result in significant improvement in quality. it cut its oil imports from Venezuela by 49%. Venezuela's state petrochemical company PEQUIVEN and Brazil's Brasquem laid out plans to build factories for the production of ammonia and urea-based fertilizers in Venezuela. Oil and Mining Sector. Fertilizer consumption measures the quantity of plant nutrients used per unit of arable land. when India increased its global share to become the world’s third-largest oil importer. published in 2015. providing .S. This is helpful for start-up enterprises. which greatly declined in the second half of the twentieth century as oil production grew to dominate the economy. which if tapped. after the U. Agriculture Sector.

They are unlikely to change in the long or mediumterm. the US-based Koch Industries. This accounts for 85% of the grease market and 16% of the oil lubricant market.000 metric tons of oil lubricants per year. and Italian-owned Snamprogetti (19. Oil accounted for 95% of the country’s exports in 2014. C.  According to Michael Fox from their news Venezuela’s State Oil Co. with Forms Joint Venture Nicaraguan Mayors Caracas. 2006—The Venezuelan state oil company PDVSA signed . regardless of any change in government or policies in Venezuela. it is the country’s largest fertilizer producer and it produces 1.99%). The Venezuelan company was founded in 1958 and over the years signed joint ownership contracts with private sector companies such as Mobil and the state-owned chemical firm Pequiven.A.  Industries Venoco. according to the state news agency AVN.99%). The company also produces chemical additives used for asphalt. Venezuela is still a significant global oil player. According to AVN. These market-driven factors are the primary reason for India’s increasing oil imports from Venezuela. Fertilizantes Nitrogenados de Oriente (Fertinitro) is jointly owned by Pequiven (34. (34.an opportunity for India to step in. April 26. has the capacity to produce 10.  Venezuela is mostly produced petrochemical from their resources but if they produce some chemical and fertilizer from the wastage of petrochemical then that’s help to reducing the import from the other countries. and industrial cleaning agents. and produces ammonium and urea fertilizers. with the world’s largest proven reserves of oil – 299 billion barrels.99%). Inc. Venezuela. industrial and agricultural machinery.000 metric tons of grease lubricants and 90.5 million tons of urea per year.

It was nationalised in October 2010. The Venezuelan government described the initiative as “strike a blow to the neoliberal policies of imperialism”.400 tonnes of urea. which will sell Venezuelan crude to the Central American country at preferential rates. having previously been owned by Pequiven (35%) and Koch Industries (35%). with the government offering 105 cents on the dollar. producing around 1.agreements with 153 Nicaraguan mayors yesterday in Caracas. FertiNitro (Fertilizantes Nitrogenados de Oriente) is Venezuela's largest fertilizer company. FertiNitro is one of the world's main producers of nitrogen fertilizer.5m tons of urea per year.000 tons of Urea (fertilizer).600 tonnes of ammonia and 4. Venezuela’s environmental ministry sponsored 10 SADR technicians to travel to Venezuela and undertake advanced training in hydrogeology and drilling. the Nicaraguan government expressed concern over a shipment of 10. The nationalization meant a substantial windfall for holders of FertiNitro corporate bonds. stating the technicians could use their training to improve SADR’s access to underground reservoirs in the Sahara for improving the production of fertilizer and chemicals Venezuela. in seemingly unrelated news. with daily production capacity of 3. In 2013. 6 Fertilizer industry in India in the . forming the joint venture Alba Petioles de Nicaragua. Meanwhile.

 Bilateral Trade Opportunity with respect to India and Gujarat The main items of India’s exports are metal and metal products.73% of nitrogenous fertilizer and 68.  With respect to Gujarat also there are many companies in the Gujarat who produced only Fertilizer and Chemical. 7 Fertilizer industry in Gujarat Fertilizer’s price is cheap as compare to chemicals. In the total GDP of India. pharmaceuticals. There are lots of opportunities to invest in Indian fertilizer sector. . Total production of fertilizer in India is around 35%. Competitors are also less in the market so it is a big opportunities for producers. So that part also represents that that Gujarat also exporting the chemical and fertilizer to the Venezuela.  The Indian fertilizer plants have adopted diverse technologies supplied by various renowned licensers. calcined petroleum coke (CPC).08% of phosphate fertilizer in 2015-2016. 35% part represented from the Gujarat industries and from that approx 15% part is from the Chemical and Fertilizer industries. But the weak point is that imported raw materials are available in the hands of few suppliers so sourcing them is a big challenge for Indian fertilizer industry. maintenance of safety and environmental standards. The opportunity is that government is supporting to start the fertilizer unit. energy consumption. chemicals. textiles.India is the third largest producer and consumer of Fertilizer in the world. The private sector produced 48. Indian fertilizer industry is bench marked as one of the best in the world in terms of operational efficiency. An opportunity for doing business in India that is It is a financially credible market.

13936.5 91 59 14 7 Venezuela (Source: Venezuelan National Institute of Statistics & Export-Import Data Bank.162 2.engineering products such as scooters. Glenmark.  The bilateral trade figures for the past four years are as below: Bilateral trade figures of Venezuela and India (In million US$) 2011 India’s Exports to 306.365 352.60 15 258. Cipla) are operating in Venezuela. An international .448 Venezuela (non-oil) to 2013 2014 2014- 355. 11669.60 60. equipment and machinery.1 from 2 14105.743 4.)  OVL and CVP (subsidiary of PDVSA) have a Joint Venture called “Petrolera IndoVenezolana SA” for production and exploration of oil in the San Cristobal field in which OVL has a 40% stake while PDVSA has the remaining 60% share. Ministry of Commerce & Industry.907 India (FOB US$) India’s oil Imports from Venezuela 2011- 2012- 2013- 2014- 2015- 12 13 14 15 16 (Apr- India’s Imports oil 6653.72 245. OVL’s investment in the San Cristobal project is around US$ 200 million.75 (CIF US$) Venezuela’s Exports 2012 0 3. Dr. Government of India. Sep) 2808. Reddy’s.07 33. Claris. The Indian pharma industry has already made a mark and some reputed companies (Sun Pharma.

 The main items of India’s imports from Venezuela are crude oil. ores. The "First Oil" from PetroCarabobo S. Oil India Ltd. Project was produced on 27 December 2012. aluminum and articles thereof India has a good opportunity to export Chemicals and Fertilizer to Venezuela because Venezuela only produce 10% chemical and 20% fertilizer approx in their country and they imported more from the other country so on the basis of that India has a good opportunity Venezuela. slugs and ash.A. Repsol of Spain and Petronas of Malaysia were declared the winners of an international bidding process to develop a multibillion dollar integrated onshore Carabobo oil project in the Orinoco belt of Venezuela. Indian Oil Corporation (IOC). (OIL).consortium comprising of ONGC Videsh Limited (OVL). iron and steel. to export the chemical and fertilizer to the .

39 -39.01 -7.00 0. Isotopes Miscellane ous Chemical Products Pharmaceu tical Products Organic Chemicals (http://www.jsp? lang=1=0.30 1.94 Chemicals.46 Growth -40.77 Import India’s Exports to % Venezuela 201 2013 % 0.913.89 0.in/vs. Companies like state-owned ONGC Videsh.988)  Recently.45 2 0. Indian Oil Corporation and Oil India have invested in Venezuela’s Carabobo and San Cristobal oil fields.858.03 1.01 0.86 0.49 3. Venezuelan’s State Oil Company.93 0. Reliance Industries has also signed a 15-year contract with PDVSA.56 3.25.Commodities Imported-Exported by Venezuela and India Description Venezuela’s Inorganic from India 2012 2013 0.09 0.09 0.42 0.21 -8. Precious Metal Compound s.00 Growth -57. to import 400.59 -30.63 2.000  barrels of oil per day.11 11.03 0. India's country run ONGC Videsh Limited oil and gas exploration and Production Company helped certify heavy oil reserves in the . India-Venezuela relations have moved a notch beyond quotidian oil transactions.indiantradeportal.45. where oil is already being produced and exported to India and other markets.

Over half of them consist of raw materials and intermediate goods such as bulk drugs. In the year 2010.Orinoco river belt. India's exports to the country include chemicals.35 billion in 2012-13. The Indian pharma industry has a significant presence  in the country. India's pharmaceutical major. and parts for machinery and equipment. which can Venezuela industries." Khurshid  told reporters. Indian exports to the region are not a threat to Venezuela industries. equipment and machinery. destination for Bangalore Venezuela has become delegations a visiting mandatory the Indian subcontinent. ONGC Videsh Limited.000 barrels of crude oil per day in its  peak time. and made nearly $25 million in revenue the year 2015. Indian IT and business process outsourcing companies are propelling Venezuela into the information age and training human resources for the knowledge economy. fabrics. yarn. Cipla has 170 medications approved to market in Venezuela. giving India the capability of producing 400. a consortium led by Indian state-owned oil companies also won a global bid to claim 40% stake in an important oil block in Venezuela. textiles and engineering products such as scooters.  iron pellets and electrical cables. The volume of bilateral trade between  the two countries was $ 14. The main items of India's imports from Venezuela are crude oil. Indian Oil Corporation and Oil India Ltd are part of the $ 20 billion Carabobo oil project in the Orinoco belt of . "The entire gamuts of bilateral relations besides various regional and multilateral issues were discussed in the meeting. cut production costs and become globally competitive. Most Indian trade and investment with Venezuela is done by private Indian companies.  Venezuela is India's largest trading partner in Latin America and supplies crude oil to India.

Venezuela. The project is aimed at producing 400.000 barrels per  day of oil (20 million tonnes) in four years.000 bpd of oil from Venezuela for processing at its twin refineries at Jamangar in Gujarat. The Reliance Industries Ltd gets about 20 per cent of its oil needs from Venezuela. . RIL currently imports about 300.

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