Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India

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Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Alkali Bulletin
(For Restricted Circulation)    Volume XLIII   No. 5           May, 2021

                   Alkali Manufacturers Association of India
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Dear Reader,

The Finance Minister, presenting the Union Budget for 2021-22 announced a National Hydrogen Energy
Mission (NHM) that will draw a roadmap for using hydrogen as an energy source. It will develop a cleaner
alternate fuel option, having the potential of transforming transportation.

Hydrogen is obtained as a by-product in the production of caustic soda, giving 280 Nm3 or about 25 kg
per metric tonne of caustic production as per stoichiometric ratio. The chlor-alkali industry has found it
advantageous to use this hydrogen as a fuel, that entitled the user to benefits under the PAT Scheme, a
flagship programme of BEE under the National Mission for Enhanced Energy Efficiency (NMEEE). Hydrogen
production by the alkali industry during 2019-20 was a little over 10,000 lakh Nm3, of which nearly 40%
was used as fuel and less than 5% was vented as unutilized hydrogen.

There is a renewed interest in hydrogen as evident from the many seminars organised by the government
and other organisations. The emphasis, though seems to be on green and blue energy which result in no
or low CO2 emissions. One line of thought is to increase the share of hydrogen as an immediate priority
and then shift towards green hydrogen. The estimated annual consumption of hydrogen in India is 6
million metric tonnes which is about 8.5% of the current global demand of 70 million metric tonnes. In
a recent webinar co-organized with the Ministry of Petroleum and Natural Gas, experts stressed four key
factors: scale of operations to achieve low production cost, international specification for transportation of
hydrogen, potential for biomass (specially in India), development of wonder storage material that is stable,
less energy intensive, and efficient.

There is a clear shift in treating hydrogen as an energy carrier more than as an industrial gas. Hydrogen
based fuel cell buses are planned to be introduced on an experimental basis in Delhi. The cost of
hydrogen-based Proton Exchange Membrane (PEM) fuel cell buses at Rs.2.5-3.0 crores per bus are much
higher than electric buses but this hasn’t deterred the transport authorities from placing orders. The
Ministry of New and Renewable Energy (MNRE) is weighing various options for procuring hydrogen on a
consistent basis, including tying up with chlor-alkali industry for long-term supplies. The discussions are in
the initial stages and offers hope, considering the capacity additions by the chlor-alkali industry expected in
the coming years. Economics and pricing will of course decide whether this fructifies.

This issue carries an article on hydrogen economy and the potential it offers in increasing the green
footprint.

                                                                                                 K. Srinivasan
                                                                                            Secretary General
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Chlorine Emergency Response Network Toll free no. 1800-11-1735

                                  CONTENTS
I. ARTICLES & FEATURES
Case Studies on Major Accidents due to Corrosion
- Dr. S.K. Chakravorty, Consultant (Plant Engineering)                                                      1
Augmenting Oxygen Output through Distributed Manufacturing
- Ravi Raghavan, Editor, Chemical Weekly                                                                    6
Hydrogen Economy for a Healthier Environment
- Nikhaar Gogna, Writer/Editor, Trade Promotion Council of India                                            8
Researchers find Novel Way to convert Single Use Plastics                                                  10
India-EU Economic Relations: A New Chapter Unfolds
- Sakshi Garg, Researcher                                                                                  12
Jal Jeevan Mission - An Update                                                                             17
Beacon-Messages for Manufacturing Personnel                                                                20
II. NEWS DIGEST

General
Govt expands credit lifeline for MSMEs amid second wave of Covid-19                                        22
Container shortage, high rates plague exporters                                                            22
Concessional import duty: Prior info of goods a must                                                       23
India’s economy will do well once vaccination reaches critical mass: Ashima Goyal                          23
Siddharth Shriram – industrialist, patron of arts no more                                                  23
Govt. may notify export refund rates by May end: DGFT Yadav                                                24
Liquidity Crunch: New mechanism in the works to aid exporters                                              24
Annual export target of $400 billion achievable if exporters’ concerns are addressed                       25
UN sees India’s GDP growth at 7.5% in 2021                                                                 25
Exports rise 80% to $7 bn during May 1-7                                                                   26
CBIC eases norm on furnishing bonds for import, export of goods till June 30                               26
Government sees limited economic impact of Covid-19 second wave                                            26
India, UK unveil 10-year road map to elevate bilateral trade partnership                                   26
India’s slow economic activity in April may hit quarterly GDP                                              27
Exports jump to USD 30.21 bn in April; trade deficit at USD 15.24 bn                                       27
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Chemicals and Petrochemicals
Producers warn of imminent salt scarcity due to excess rains in T’kudi                                                       28
Vedanta to set up Rs 10,000 cr Aluminium Park in Odisha                                                                      28
Ministry of Power to launch biomass mission for coal plants                                                                  28
India’s Adani Group plans 2m tonne/year coal-to-PVC plant                                                                    29
Hydrogen Electrolysis Capacity to Witness a Huge Jump by 2040                                                                29
Olin announces further chlor alkali capacity reduction                                                                       29
University Of Alberta: Some E. Coli Bacteria Not Only Survive But
Thrive In Wastewater Treatment Plants: Study                                                                                 30
Production of Medical Oxygen from modified Industrial Nitrogen Plants                                                        30

Member Units
DCM Shriram Ltd. sets up oxygen generation plant at ESIC, Ankleshwar                                                         31
Bodal Chemicals forms Indonesia subsidiary                                                                                   31
Century Textiles & Industries lines up Rs 1,000 cr capex for Birla Estates                                                   31
DCW Q4FY21 PAT at Rs. 6.46 Cr                                                                                                32
Chemfab Alkalis reports Q4FY21 consolidated loss at Rs. 11.67 Cr                                                             32
Punjab Alkalies and Chemicals posts Rs. 4.57 Cr net profit in Q4 FY2020-21                                                   33
Gujarat Alkalies expects delay of 3 month in completion of its various expansion projects                                    33
GHCL will invest Rs 400-500 crore in FY22: Ravi S Jalan, MD                                                                  33
Nirma Group-backed Nuvoco Vistas files Rs 5,000-cr IPO papers: Details about the IPO                                         34
Reliance Industries produces over 11pc medical grade liquid oxygen in India                                                  35
Chemplast Sanmar files papers for `3.5k cr IPO                                                                               35
III. NOTIFICATIONS/PRESS RELEASES/ MEMORANDA
Anti-Dumping Original Investigation concerning imports of “Soda Ash”
from United Arab Emirates (UAE) and Russia - Initiation Notification - 27/05/2021                                            38

                                                                                                                                    Alkali Bulletin May, 2021
Amendment in Public Procurement (Preference to Make in India) Order dated 13.05.2021                                         38
Launch of Online Portal for lodging grievances for alleged violation
of PPP-MII Order, 2017 – 05/05/2021                                                                                          38

Disclaimer: Information published in this magazine is reproduced from various sources. Every effort is made to minimize errors
while reproducing for publication in Alkali Bulletin. However, readers are requested to verify and make appropriate enquiries
and satisfy themselves about the veracity of information published in this magazine before use. The publisher or AMAI will not be
responsible for decisions taken by readers based on information published in Alkali Bulletin.
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Case Studies on Major Accidents due to Corrosion
                                                                       Dr. S.K. Chakravorty, Consultant (Plant Engineering)

INTRODUCTION                               its way in and around the shantytowns          walled, partly buried stainless steel
                                           located near the plant. Estimates              tanks — code named 610, 611 and
While mankind has made remarkable          vary on the death toll. However, the           619. While thousands of people slept
progress in the last century, there        official record of immediate death toll        in their huts around the pesticide
have been some instances in the past       was 2,259. The number of people                factory on the night of December
where innocent human lives were            injured was over 1, 70,000, out of             2/3, a skeleton staff of 120 workers
lost due to some miss-happenings           which 12000 people were in critical            inside the factory ended its evening
as the unwanted by-product of the          condition and had to be immediately            shift around 10.45 pm and a new shift
large scale industrialization. Corrosion   hospitalized. Figure-1 shows the               took over around 11 pm. One of the
by itself is usually an extractive         aftermath of the Bhopal Gas Tragedy            workers then noticed that the pressure
metallurgy in reverse and bound to         where individuals died within hours of         in tank 610 — the tank from which
take place sooner or later, but the        the leakage of gas and its expansion in        all the MIC finally escaped — had
consequences of corrosion failure          the atmosphere of Bhopal.                      risen from two lb per square inch
may well be catastrophic in nature                                                        (psi), recorded by the earlier shift, to
and the consequences of corrosion          From a corrosion engineer’s point              around 10 psi. Corresponding tank
are usually very costly. Therefore, a      of view, the Bhopal disaster was               temperatures were not available as
substantial engineering effort should      the result of a combination of                 they were not logged normally. The
be directed towards prevention and         legal, technological, organizational,          five-fold increase in pressure within
control of corrosion. In this article,     and human errors. However, the                 an hour was dismissed in the belief
those events are discussed where           immediate cause of the chemical                that the pressure recording instrument
corrosion was responsible for taking       reaction was the seepage of water              could be faulty. Shakil Qureshi,
the lives of hundreds of individuals.      (500 litres) into the MIC storage tank.        the supervisor on duty, said later,
The four major disasters took place        Many investigators and researchers             “Instruments often didn’t work as they
due to corrosion of plant components       have agreed that corrosion of                  got corroded.
and their causes are discussed in this     pipelines, valves and other safety
article for highlighting the importance    equipments was the main culprit                How the water entered the pipelines
of corrosion prevention in the             for this catastrophe. The following            connected to the MIC containing
management of disasters.                   evidences are presented to support             stainless steel tank is altogether a
                                           the argument.                                  different story, but its entry inside
1. BHOPAL GAS TRAGEDY                                                                     the MIC containing tanks could
                                           MIC was stored in three double-                have been averted had the proper
The Bhopal disaster, also referred to as
the Bhopal gas tragedy, was a gas leak
incident in India and is considered
as one of the world's worst industrial
disasters. It occurred on the night of
2–3 December 1984 at the pesticide
plant of Union Carbide India Limited
(UCIL) in Bhopal, Madhya Pradesh.
Over 500,000 people were exposed
to about 20,000 Kgs of methyl-iso-
cynate (MIC) gas. MIC is a highly
reactive, flammable and toxic material
and can react with water generating
heat. It boils at 39 deg C and its flash
point is as low as 18 deg C. In view of
its highly toxic properties, threshold
limit value for MIC has been fixed at
0.02 ppm. The toxic substance made
                                              Fig 1 Picture showing the aftermath of Bhopal Gas Tragedy (people died within hours)

                                                                                                         Alkali Bulletin May 2021 | 1
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
excessive heat generated inside the
                                                                                         tank increased the vapour pressure
                                                                                         and let MIC to escape from the tanks
                                                                                         and spread to the atmosphere.

                                                                                         The precise sequence of events still
                                                                                         remains obscure. Carbide’s report
                                                                                         had claimed that it was an unique
                                                                                         combination of large amounts of
                                                                                         water (120 to 240 gallons), higher
                                                                                         than normal amounts of chloroform in
                                                                                         the stored MIC (maximum permissible
                                                                                         amount is 0.5 per cent), and an
                                                                                         iron catalyst, that led to the violent
                                                                                         reaction in MIC, stored at a higher
                                                                                         than specified temperature. The heat
                                                                                         released by the reaction between
                                                                                         the water and MIC raised the
             Fig 2 Corroded sections & components of UCIL’s pesticides plant             temperature abnormally in the tank.
                                                                                         Simultaneously, MIC got polymerized.
maintenance of the valves connecting             slip-blind plates which would have      The reaction was catalyzed by iron
the pipelines to the tank being done.            prevented the entry of water through    present in MIC due to the corrosion
Carbon steel valves were used for                the faulty valves were not installed.   of the tank walls. Union Carbide
this purpose. Carbon steel valves                Once the water entered inside the       claimed that the corrosion rate
easily corrode in acidic environment,            MIC containing tanks through faulty     increased markedly because of the
which was actually happening in                  valves, the MIC reacted with water      presence of an abnormally high level
Union Carbide plant. Moreover,                   following an exothermic reaction. The   of chloroform. The rapid release of
                                                                                         carbon dioxide in large quantities then
                                                                                         helped to build up high pressures,
                                                                                         which forced the foaming mass of
                                                                                         chemicals out of the tank.

                                                                                         The situation became unmanageable
                                                                                         as it was found out that the Flare
                                                                                         Tower could not be used as the
                                                                                         length of piping was corroded and
                                                                                         had not been replaced. The flare
                                                                                         tower was designed to burn off MIC
                                                                                         escaping from the scrubber. The
                                                                                         tower, however, was inadequately
                                                                                         designed for its task, as it was capable
                                                                                         of handling only a quarter of the
                                                                                         volume of gas released. Still the extent
                                                                                         of disaster could have lessened if
                                                                                         corrosion of piping could have been
                                                                                         prevented and the same would have
                                                                                         been replaced in time as a preventive
                                                                                         maintenance activity. Additionally
                                                                                         the MIC storage tanks were provided
                                                                                         with a refrigeration system to keep
                                                                                         the temperature inside the tank at
                                                                                         low temperature (below 39 deg C).
                                                                                         The refrigeration system was put
                                                                                         off deliberately at the time of the
                                                                                         accident due to leakage in the system.
                           Fig 3 BP Pipeline Failure in Alaska                           It was found that the leakage was
                                                                                         again due to corrosion.

2 | Alkali Bulletin May 2021
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
Thus Bhopal gas tragedy took place         On investigation, it was found that        2005 caused BP to step up the
basically because of the corroded          internal corrosion had caused a one-       inspection program on the pipeline.
pipelines and valves associated with       quarter-inch hole in the bottom of the     The company increased the number
the storage tanks and the refrigeration    transit pipeline. The hole had formed      of inspection points, increased the
system. Figure-2 shows the file picture    in a section of line buried under a        frequency of inspections at some
of the plant indicating the corroded       caribou crossing (a culvert) designed      points and scheduled a smart
sections/components. Many people           to allow animals to cross over a           pig inspection for the summer of
in India still prefer to ignore the        pipeline. The winter snow covered          2006. An inspection of the line
significance and consequences of           the leaking oil, so the spill remained     after the March 2006 showed leak
corrosion, which is considered to          undetected, probably for several days.     indicating evidence of high rates of
be a natural part of wear and tear. It     It was the odour of oil that ultimately    corrosion, even in place that had
is evident that, as a result of UCL’s      exposed the leak to a worker.              been free of corrosion in the fall 2005
negligence for corrosion control,                                                     inspection. Clearly, there had been
so many human lives were lost. In          All indications were that the corrosion    an exponential growth of corrosion,
addition, the environmental hazard         causing a hole in the transit line was     culminating in the hole in the pipeline
created by MIC release persisted for       biological in origin (microbiological),    that caused the oil spill.
many years affecting the health of the     caused by sulphate reducing bacteria
entire citizens of Bhopal. The above       inside the pipeline. The corrosion         BP failure investigation report
disaster analysis proves how much          pits confirmed this and also the           theorized two main factors that
important is corrosion control for         way in which the corrosion in the          came together at the same time. The
an industry dealing with hazardous         pipeline accelerated over time was         first factor was related to corrosion
chemicals not just to avoid its own        characteristic of the way in which         inhibitors. BP added about 3 million
losses but also the loss of innocent       microbiological corrosion develops, as     gallons per year of these inhibitors
lives of the people residing around the    the bacteria grow and multiply.            to Prudhoe Bay production fluids;
vicinity of it.                                                                       the fluids carried the inhibitors
                                           The bacteria forms in water, so            into production facilities such as
                                           that problems associated with
2. PRUDHOE BAY 2006 OIL                                                               GC-2. But the corrosion inhibitors
                                           microbiological corrosion were             appeared to have been present in
SPILL                                      suspected to be associated with the        relatively low concentrations in the
The Prudhoe Bay oil spill was an oil       water carrying pipelines, such as the      GC-2 production facilities, when
spill that was discovered in March,        lines which were used for water flood      compared with the other Prudhoe
2006 in a pipeline owned by BP             operations. BP had observed that oil       Bay facilities. It was thus concluded
Exploration, Alaska (BPXA) in western      carrying transit lines, such as the line   that the fluids passing down the GC-2
Prudhoe Bay, Alaska. On March              from GC-2, is much less susceptible        transit line from GC-2 contained
2, 2006 a BP extraction well pad           to corrosion than a water bearing line.    only small amounts of the inhibitors,
operator discovered a leak in the          However, the company had regularly         thus providing opportunities for
transit line that delivers oil to the      monitored the Prudhoe Bay oil transit      corrosion-causing bacteria to grow.
trans-Alaska pipeline from Gathering       lines for internal corrosion using two     The corrosion inhibitor shortfall may
Centre (GC)-2 in the western               techniques: ultrasonic testing and the     have occurred because GC-2 was the
operating area of the giant Prudhoe        use of corrosion coupons.                  only facility at Prudhoe Bay which
Bay oil field on Alaska’s North Slope.                                                processed viscous oil. The viscous oil
                                           Ultrasonic testing involves the use of
The leak occurred in the transit line                                                 production introduces more solids
                                           an ultrasonic device to measure the
segment between GC-2 and the                                                          into the processing facilities than
                                           thickness of the pipeline wall — a
point where the production from                                                       traditional production and BP thought
                                           thinning of the wall indicates the
GC-1 enters the line. BP launched                                                     that these additional solids may have
                                           presence of corrosion. A corrosion
an immediate response to the event.                                                   adsorbed some of the inhibitor. Some
                                           coupon is a small metal plate placed
An estimated volume of around                                                         of the bacteria present in the oil
                                           inside the pipeline and inspected for
200,000 gallons leaked from the                                                       degrade the aromatic and aliphatic
                                           corrosion rate every 90 days.
pipeline proving to be the largest spill                                              hydrocarbons present in the corrosion
in the history of Prudhoe Bay. The         For straight 29 years, BP noted            inhibitors reducing the efficiency of
failure led to reduction of total oil      “nothing of significance”. It was          the corrosion inhibitor leading to
field production by 400,000 barrels/       only in fall of 2005 that evidence of      accelerated corrosion rates.
day which was about 8% of US oil           increasing corrosion activity started
production. Figure-3 shows the BP          to appear. The increasing amount           The second possible factor was
pipelines.                                 of corrosion found in the fall of          the relatively low flow rate in the
                                                                                      GC-2 transit line, upstream of GC-

                                                                                                   Alkali Bulletin May 2021 | 3
Alkali Bulletin May, 2021 - Alkali Manufacturers Association of India
material) oxidation in a series of 6
                                                                                               successive reactors. Each reactor,
                                                                                               having a capacity of 45 m³ (5 m high
                                                                                               with a 3.5 m diameter), was made
                                                                                               of a 13-mm soft steel plated on the
                                                                                               inside by stainless steel (3 mm thick)
                                                                                               and featuring a central agitator. The
                                                                                               oxidation process was carried out in
                                                                                               the presence of a catalyst, by means
                                                                                               of injecting compressed air. In order
                                                                                               to allow for gravity transfer, each
                                                                                               reactor was kept at a lower level than
                                                                                               the previous one. The reactors were
                                                                                               connected with 28 in. (700mm) pipe.

                                                                                               On March 27,1974, a cyclohexane
Fig 4 Clean up crews recovering more than 19000 gallons of crude leaked from the pipeline      leak was observed on Reactor no.
                                                                                               5 due to a vertical crack within
1. With Prudhoe Bay production in              BP should have started pigging of the           its sidewall. The facility operator
decline, the transit line was carrying         pipeline much before for detecting              conducted a thorough inspection by
much smaller volumes of oil than               pipe wall defects, weld defects,                removing the reactor no.5 and its
the line was designed to handle                and cracks so that the catastrophic             associated pipes. In order to resume
— the resulting sluggish flow may              failure could have been avoided.                production as quickly as possible, it
have enabled an increased build up             Additionally, DNA probes should                 was decided to build a bypass pipe
of water in the line and provided              have been installed on the pipeline             line of 500mm instead of 700mm
an environment conducive to the                to identify the dominant bacteria               between Reactors 4 and 6. It was
incubation of bacteria. There was              responsible for microbial corrosion.            decided to use metallic bellows to
much less corrosion downstream from            The preventive efforts were very much           connect the pipes to the flanges.
GC-1, where the addition of the fluids         needed as the consequences of the oil           In fact the bellows acted also as
from GC-1 would have increased flow            spill caused not only huge production           reducers. Experienced maintenance
rates in the line.                             loss but also polluted the bay and              engineers were involved in carrying
                                               needed huge clean-up job as shown               out this modification but no one from
There was also a build up of solids in         in Figure-4.                                    process safety was involved. This
the GC-2 transit line over a period of
                                                                                               modification worked well for about
several years, as sediment carried by          3. FLIXBOROUGH DISASTER                         two months but on the fateful day of
the fluids from the GC-2 processing
                                               Built in 1972, the caprolactam unit             1st June, 1974, the connecting pipe
facilities settled in the pipeline.
                                               processed cyclohexane (a flammable              gave way, twisted and tore allowing
Bactericide was adhering to the
sediments and grew rapidly. Therefore
it is not possible to discount the
possibility that these solids (sediments)
contributed to the microbial corrosion
leading to rapid thinning of the
pipeline and formation of a hole
through which the oil spilled.

Sulphate reducing bacteria (SRB)
are small anaerobic microorganisms.
When conditions are right they can
multiply to the level of millions of
cells per gram and generate significant
quantities of hydrogen sulphide (H2S).
The H2S together with the stagnant
conditions formed in the pipe wall
lead to enhanced microbial pitting
corrosion rates.                                                  Fig 5 File photo of the explosion in Flixborough Plant

4 | Alkali Bulletin May 2021
release of huge amount (30-50 tons)       From a corrosion engineers standpoint          certainly be avoided to a large extent.
of cyclohexane leading to a major         the cause of sewer explosion was               The timely measures taken on the
explosion consequently causing death      traced to the installation of the              part of engineers can result not only
of 28 people. Figure-5 shows the file     water pipe by a contractor several             in cost reduction in the industry or
photo of the explosion site.              years before the explosion which               organization, but also can become a
                                          leaked water into a gasoline line              saving cause for hundreds of valuable
From a corrosion engineers point of       lying underneath. The cathodically             human lives. History always has its
view the explosion took place due to      protected steel gasoline pipeline had          way of delivering lessons, time has
the ignition caused in the cyclohexane    a hole inside a cavity and an eroded           come that a developing country like
which leaked from the bypass joints       area, all in longitudinal direction.           ours takes steps at every possible level
of rector 4 and 6. At the origin of the   The galvanized water pipe had                  to reduce the risk of any occurrence
accidental sequence, the deficiency       suffered stray current corrosion effects       of catastrophic failures and disasters
of Reactor no. 5 stemmed from stress      (visible as pits of different sizes),          due to corrosion and degradation of
corrosion cracking caused by nitrates     Refer Figure-7. The corroded water             materials.
contained in the water used in the        pipelines lead to the leakage of water
past to spray the reactors. This water    causing aqueous corrosion of gasoline          REFERENCES:
had penetrated into the insulation        pipelines leading to leakage of                1. Krishnan, N.V., Safety Management in
and, during evaporation, deposited        gasoline into the sewers and initiating        Industry, (1993), Jaico Publishing House,
nitrates onto the equipment made of       series of explosions.                          ISBN: 81-7224-029-5, M. G. Road,
steel. The cause of the leak on Reactor                                                  Bombay.
no. 5 should have been analyzed           CONCLUSION:
prior to any unit modification and the                                                   2. Petrovic, z.c., Catastrophes caused by
                                          While the occurrence of corrosion              corrosion, Serbian Armed Forces, AF &
other reactors should also have been
                                          and environmental degradation of               AD, 204th Aviation Bridge, Batajaimica,
inspected. Such an approach however                                                      Republic of Serbia, 2016, Vol. 64, No. 4.
would have required shutting down         the materials seems inevitable, it can
the plant for a few days; the concern
over minimizing plant downtime and
haphazard modification actually led
to the accident. The crack in Reactor
no. 5, which served as the source of
the accidental sequence, stemmed
from corrosion caused by spraying
the reactor with drinking water
(high in nitrates). in order to dilute
cyclohexane discharge and limit the
risk of ignition, water was sprayed on
the reactors. Thus, Nitrate-induced
stress corrosion cracking was held
liable for Flixborough disaster.

4. GUADALAJARA SEWER                                Fig 6 File photo showing the aftermath of Guadalajara sewer explosions
EXPLOSION
The 1992 Guadalajara explosions
took place on April 22, 1992, in the
downtown district of Analco, Spain.
Numerous gasoline explosions in
the sewer system over four hours
destroyed 8 kilometres of streets.
Officially, by the Lloyd's of London
accounting, 252 people were
reported killed; nearly 1500 injured
and 15,000 were left homeless.
Figure-6 shows the file photo of
the aftermath of Guadalajara sewer
explosion.                                          Fig 7 File photo showing the aftermath of Guadalajara sewer explosions

                                                                                                        Alkali Bulletin May 2021 | 5
Augmenting Oxygen Output through Distributed Manufacturing
                                                                                         Ravi Raghavan, Editor, Chemical Weekly

 COVID-19 has brought forth the             Technology in Hyderabad, for                  (ASUs) that provide much of the gas
 vital role of the chemical industry,       example, has developed technologies           (along with nitrogen and argon), are
 and tragically demonstrated that the       for the manufacture of the raw                very much part of this industry. Most
 industry can make all the difference       material needed to make an adjuvant           ASUs are built to serve the oxygen
 between life and death. Since the last     for Covaxin – the vaccine developed           needs of large industrial consumers,
 two weeks, as India’s teeming cities       and produced indigenously in a                such as oil refineries, steel mills,
 and even the hinterlands face the          partnership between Bharat Biotech            petrochemical plants, etc., and, less
 wrath of this virus, oxygen shortages      Ltd. and the publicly-funded Indian           commonly, the merchant market. At
 are all the talk. A clear assessment of    Council of Medical Research. But              the captive facilities – typically built
 mortality may well reveal that a large     much more needs to be done to be              onsite of the customer – gaseous
 number happened due the inability to       truly called aatma nirbhar in vaccine         oxygen is ferried by pipeline (the
 keep oxygen flowing in hospitals.          technology!                                   most efficient way) to the point of
                                                                                          use, and some of it is liquefied and
 If that was not tragic enough, two         This weakness in building capabilities        stored as a buffer against planned and
 accidents – a leakage of an oxygen         across full value chains for meeting          unplanned outages or for supplying to
 storage tank and an electric short         critical needs is evident across the          other cylinder-fillers that serve smaller
 circuit in an ICU (both in the badly-      pharmaceutical industry. As lamented          customers (including many hospitals).
 affected Maharashtra) – brought home       often in this column, several raw             In most ASUs, only a small portion of
 the fact that even in these challenging    materials – active pharmaceutical             the total oxygen output is targeted for
 times, no one can take eyes of safety      ingredients and their starting materials      medical use.
 and maintenance protocols.                 (i.e., chemicals) are imported in large
                                            measure by domestic companies.                It is this supply that has fallen short
 Weak Foundations                           In most instances, a big chunk of             of soaring demand from hospitals,
 The chemical industry’s key role           imports come from China – an                  and sent governments scrambling to
 in providing the thousands of raw          uncomfortable situation prone to              mop up all they can get their hands
 materials that go to make life-saving      disruptions, as amply demonstrated            on, even if that requires ordering
 drugs and even the vaccines that           several times in just the recent past.        most industries to curb their captive
 producers here are looking to scale up     The Indian government is cognisant            consumption of oxygen.
 several-fold, cannot be overstressed.      of this vulnerability and is, at last,
                                            encouraging domestic manufacture              But this solves just part of the
 There is much talk today on serious                                                      problem. Just as challenging is the
 shortages of inputs that go to making      of some critical drugs and their
                                            starting materials, by providing grants       logistics of ferrying the oxygen from
 vaccines, and several of them are                                                        the production site to where the
 chemicals made to highly exacting          under a Production Linked Incentive
                                            Scheme, the last tranche of which was         hospitals are. Supplies of medical
 standards. While India’s competence                                                      grade oxygen are typically made
 in making vaccines is rightly              announced just a couple of weeks
                                            ago.                                          in pressurised gas cylinders or by
 recognised world-over, COVID-19                                                          cryogenic tankers that ferry liquefied
 has amply demonstrated that this is                                                      oxygen to storage tanks installed
                                            Oxygen and the Chemical
 built on a somewhatshaky foundation.                                                     in the premises of hospitals. The
                                            Industry
 Be it adjuvants that improve the                                                         unprecedented surge in demand has
 efficacy of the vaccines, or the single-   One of the realities of the chemical          exposed the limitations of this supply
 use bioreactors (made of medical           industry is that it is an industry largely    chain, which requires customised
 grade plastics, incidentally), India’s     for other industries. The common              vehicles.
 indigenous capabilities have been          man rarely confronts chemicals in its
 found wanting.                             ‘naked’ form.                                 At this critical juncture, it is hence
                                                                                          pertinent to relook current ways of
 Some attempts have been made to            Few will hence make the connection            producing oxygen, and consider
 develop technologies for the former;       between oxygen and the chemical               alternatives, that will serve immediate
 the Indian Institute of Chemical           industry, but the air separation units        and future needs.

 6 | Alkali Bulletin May 2021
Technology Choices:                        enriched in oxygen. When the bed          at 4-Bar pressure, which is directly
Cryogenic vs Non-Cryogenic                 reaches the end of its capacity to        produced from the PSA generators.
                                           adsorb nitrogen, it can be regenerated    The oxygen storage tank can hence
Cryogenic air separation, as practiced     by reducing the pressure, releasing the   be connected to the hospital oxygen
by the large ASUs, is the most efficient   adsorbed nitrogen. It is then ready for   pipeline network and even integrated
and cost-effective technology for          another cycle of producing oxygen-        with a back-up cylinder system to
producing large quantities of oxygen,      enriched air.                             ensure uninterrupted supplies in
nitrogen, and argon as gaseous or                                                    the event of outages. Hospitals can
liquid products. In this process, large    PSA plants are relatively inexpensive,    even set up their own cylinder filling
volumes of air are taken from the          and can be quickly scaled up when         stations using the PSA units as gas
atmosphere, compressed, cooled,            needed. They (and other non-              source, freeing them completely from
and liquefied. Through a process of        cryogenic sources) are most suitable      external cylinder gas supplies.
distillation, the air is then separated    when high purity product is not
into its major components. The cost        required by the application (as is,       Over the last few days, the central and
of electricity is the largest single       ironically, the case for medical grade    state governments have announced
operating cost incurred in ASUs –          oxygen). This is because the physical     plans to build hundreds of such PSA
usually between one-third and two-         size of the plant can be reduced as       systems across the country, in a bid to
thirds of operating costs (remember,       required purity is reduced, and the       locally produce and consume oxygen.
the raw material, air, is free).           power required to operate the unit        According to offers received for a first
                                           is reduced as well. They are also         round of tendering, a PSA plant that
Unlike cryogenic plants, which use         relatively quick and easy to start-up,    can supply 24 cylinders worth of gas
the difference between the boiling         which is useful when product is not       per day, costs about Rs. 3.3-mn, and
points of nitrogen and oxygen to           needed full time.                         can be set up in a couple of weeks.
separate and purify these products,                                                  The investments can payback in about
non-cryogenic air separation plants        Membrane air separation is based          18 months.
use physical property differences such     on the principle that different gases
as molecular structure, size and mass      have different permeation rates           There will be cases where the
to produce nitrogen and oxygen. The        through a polymer film. Oxygen            economics make it more attractive to
most common technologies used are:         (plus water vapour and carbon             source oxygen from ASUs, rather than
                                           dioxide) is considered a "fast gas"       produce it captively. In many urban
1. Pressure swing adsorption (PSA)
                                           which diffuses more rapidly through       centres, for example, hospitals are
    – used to produce nitrogen or
                                           the tube walls than the "slow gases,"     constrained for space to locate a PSA
    oxygen using different adsorbents;
                                           argon and nitrogen. This “fast gas/       unit. Others may be closely located
2. Vacuum swing adsorption (VSA) (a        slow gas” diffusion allows dry air to     to an ASU or a cylinder filling unit
    variant of PSA) – used to produce      be converted into a product that          that can respond in quick time to a
    oxygen;                                is an inert mix of mostly nitrogen        surge in demand. But even in these
3. Membrane separation – used to           gas and argon, and a low-pressure         instances, there is a case to be made
    produce nitrogen; and                  "permeate" enriched in oxygen. Today,     for investing in captive capacity for
4. Ion transport membrane (ITM) (an        membranes are widely used for the         a critical need as oxygen, if not as a
    emerging technology) – which uses      production of nitrogen and oxygen-        prime supply source, but as a fall-back
    a ceramic membrane to deliver          enriched air at small scale and for       option. These are small investments
    high-purity oxygen.                    mobile applications. These units are      that can be easily afforded and/or
                                           economical, compact in size, modular      facilitated by forward-thinking policies
PSA processes rely on the fact             in configuration and have low specific    and initiatives.
that under pressure gases tend to          power consumption.
be attracted to solid surfaces or                                                    Though the acute phase of this
"adsorbed". The higher the pressure,       Relevance of PSA                          pandemic will abate over time, there
the more gas is adsorbed; when                                                       will always be a need for medical
the pressure is reduced, the gas is        PSA plants have been used for             oxygen across the length and breadth
released, or desorbed. When air is         producing medical-grade oxygen since      of India. PSA technology offers an
passed under pressure through a            the 1970s, and require basic and          opportunity to overcome the logistical
vessel containing an adsorbent bed         readily available equipment: an air       barriers associated with servicing the
that attracts nitrogen more strongly       compressor (with refrigeration dryer),    needs of a large and populous country
than it does oxygen, part or all of the    oxygen generator (with adsorbent,         that has a long way to go in creating
                                           controls and oxygen analyser), oxygen     quality healthcare infrastructure!
nitrogen will stay in the bed, and the     buffer tank, and bacteria filter unit.
gas coming out of the vessel will be       In most hospital, oxygen is consumed      (Reproduced with permission from
                                                                                     Chemical Weekly, 04th May 2021)

                                                                                                  Alkali Bulletin May 2021 | 7
Hydrogen Economy for a Healthier Environment
                                                         Nikhaar Gogna, Writer/Editor, Trade Promotion Council of India

With appropriate capacity addition         and 10 times by 2050. It goes on to         any time. Prof. Rangan Banerjee,
to renewable power generation and          state:                                      Forbes Marshall Chair Professor
a favourable policy ecosystem, India                                                   and Head of the Department of
can catapult itself as a South Asian       Given the limits of direct                  Energy Science and Engineering, IIT
leader in producing affordable green       electrification and the potential           Bombay, explains:
hydrogen. It can even potentially          of hydrogen to overcome some
emerge as a leading exporter of            of these barriers, we see it as the         Hydrogen is a convenient and
hydrogen like Australia, Netherlands,      next clean energy prize under               secondary fuel source. Let us take
Canada and USA.                            the energy transition. A range of           the example of obtaining hydrogen
                                           countries, companies and multi-             from solar PVs. All the generation
• Hydrogen (particularly ‘green            lateral organisations are already           which will happen will be during the
  hydrogen’ produced from                  pushing ahead with ambitious plans          sunshine hours, and the excess energy
  renewable electricity or ‘blue           to develop and deploy hydrogen at           produced will have to be stored. It
  hydrogen’ obtained from fossil           scale.                                      is costly to store that energy. The
  fuels with carbon capture and                                                        advantage of hydrogen is that we can
  storage) could be India’s hope for       Is it as light as it gets?                  produce it anytime, store it and use it.
  decarbonizing development.
                                           Hydrogen, the lightest element on           Given its advantages, many countries
• Hydrogen is a convenient and             earth, is estimated to account for
  secondary fuel source with                                                           in the world are making a transition
                                           90% of all atoms in the universe, and       to hydrogen. For example, in June
  a versatile set of industrial            it is essential to the material world.
  applications which can significantly                                                 2018, then-Minister for Ecological
                                           Another advantage of hydrogen is that       and Inclusive Transition Nicolas Hulot
  help India, the planet’s third-largest   it can be obtained from a number of
  emitter of carbon dioxide, to                                                        vowed to establish France as world
                                           sources.                                    leader in hydrogen. Few months
  decarbonize its growth.
                                           ‘Grey hydrogen’ is produced from            down the line, the country deployed
• However, one of the key
                                           fossil fuels (& is therefore, relatively    its first hydrogen-powered passenger
  disadvantages of using green and
                                           less eco-friendly), ‘blue hydrogen’ can     bus.
  blue hydrogen is the high cost of
  producing and maintaining it.            be manufactured from fossil fuels with      Germany has adopted a ` 9 billion
• Yet, its important to recognize          carbon capture and storage and ‘green       (US$ 10.2 billion) National Hydrogen
  that developing economies have           hydrogen’ is made from renewable            Strategy, with emphasis “green
  at least as much to gain from a          electricity (& is hence, the most eco-      hydrogen” production. It is one of
  move towards green hydrogen as           friendly fuel). Hydrogen, especially        the first countries in the world to do
  industrialized ones.                     the blue/green one, can play an             so. Japan has set an ambitious target
                                           integral role in curtailing the country’s   of setting up 40,000 fuel cell vehicles
There’s a universal clamor to              carbon dioxide emissions and                by 2020; 200,000 fuel cell vehicles
decarbonize development in order           improving air quality. Consequently,        by 2025; and 800,000 by 2030; 320
to cut down greenhouse emissions           as people breathe fresh air, diseases       hydrogen refuelling stations by 2025;
and check global warming. With the         related to air pollution like allergic      and 900 by 2030; and. 1,200 fuel
debate intensifying around net zero        cough are also likely to drop.              cell buses by 2030. South Korea also
carbon emissions, the pressure on
                                           Another major advantage of hydrogen         rolled out the Economic Promotion
India, particularly, is mounting as it
                                           is its versatile uses. For example,         and Safety Control of Hydrogen Act,
is seen as the planet’s third-largest
                                           liquid hydrogen (LH2) fuel has              which deals with three key areas –
emitter of carbon dioxide. Hydrogen
                                           played an important role in space           hydrogen vehicles, charging stations
(particularly ‘green hydrogen’
                                           exploration since NASA’s Apollo             and fuel cells.
produced from renewable electricity
or ‘blue hydrogen’ obtained from           program and can be used in fuel             India too has taken a few steps in this
fossil fuels with carbon capture and       cells to produce electricity. Apart         regard. Lately an alliance of energy
storage) could be key to India’s vision    from this, it can be used to make           and industrial firms named India H2
for decarbonizing development.             steel, aluminium, electronics and in        Alliance (IH2A) has come together
A TERI report estimates that the           public transportation. Plus, unlike         for commercializing hydrogen
potential scale of hydrogen use in         some of the other forms of energy           technologies and creating a hydrogen
India is likely to increase between 3      like solar power, it can be obtained        economy. It will focus on the

8 | Alkali Bulletin May 2021
establishment of standards for storage     List of assumptions for the techno-economic analysis
and transport hydrogen in pressurized
and liquefied form. Further, Fusion        Component                                 Unit            2020     2030         2040
Fuel Green — which has offices in          Solar cost                                US$/kW          405      317          281
Ireland and Portugal —signed an            Wind cost                                 US$/kW          848      642          534
agreement with BGR Energy Systems
to collaborate in this field.              Alkaline electrolyser cost                US$/kW          950      625 (400) 450 (200)
                                           Alkaline electrolyser efficiency          %               66.5     68 (71)      75 (80)
Meanwhile, the Government of India         Hydrogen storage cost                     US$/kW          582      345          100 (89)
is working well on its plan to boost
India’s renewable power capacity to        Alkaline electrolyser life                Years           20       20           20
175 gigawatts (GW) by 2022. It has         Alkaline electrolyser operation and       %               7        5            5
also given impetus to scaling up the       maintenance
gas pipeline infrastructure across the     Power converter                           US$/kW          60       60           60
country and is working to scale up
                                           Solar operation and maintenance           %               2.5      2.5          2.5
its power grid system. Further, the
Finance Minister in the Union Budget       Wind operation and maintenance            %               2.3      2.3          2.3
for 2020-21 formally announced             Storage operation and maintenance %                       1        1            1
the National Hydrogen Energy               Power converter operation and             %               2        2            2
Mission (NHM) initiative, which aims       maintenance
at the generation of hydrogen from
                                           Demineralised water                       US$/tonne 1.25           1.25         1.25
green power resources.
                                           Source: CEEW & SHAKTI
Luckily, India’s favorable geographic                                                        a big demand from steel industry, but
conditions and presence of abundant        A UNEP report justifies the same:                 India has. Industries will be one of the
natural elements work to its advantage                                                       significant drivers down the line, and
                                           Developing economies have at                      hence, the focus should be on the
and help the nation move one step          least as much to gain from a move
closer to achieving this dream. What                                                         industrial decarbonization.
                                           towards the hydrogen economy
doesn’t work to the country’s favour,      as industrialised ones, since they                But the government will also have
however, is the huge cost involved in      generally suffer more from urban                  to create a conducive ecosystem
producing green hydrogen. Currently,       pollution and their economies tend to             to support the hydrogen economy.
the technology used in production          be more energy intensive.                         This could be in the form of creating
and use of hydrogen like carbon
                                                                                             favorable incentives like tax breaks for
capture and storage (CCS) and              This calls for exploring some solutions           investors as well as creating suitable
hydrogen fuel cell technology are          to make it more commercially viable.              infrastructure systems connecting
at a nascent stage and therefore,          One thing that can be done is to                  states with renewable energy (eg
producing it may not be commercially       create attractive policies to promote             Gujarat) with states having hydrogen
viable. Further, the example of South      foreign investments in the sector. Not            requirements (eg Odisha). With
Korea highlights that even maintaining     only will that align with the objective           appropriate capacity addition to
fuel cells is a costly affair. The table   of Atma Nirbhar Bharat, foreign                   renewable power generation, and a
given below gives an insight into this.    collaboration will also enhance the               favourable policy ecosystem, India
                                           cash crunch faced by the country,                 can catapult itself as a South Asian
Another disadvantage of hydrogen is        promote R&D in India and facilitate
that owing to its low density, it has to                                                     leader in producing affordable green
                                           technology transfer and exchange of               hydrogen. If all goes well, it can
be converted into a liquid form for        ideas.
storage. This reduces its efficiency                                                         also emerge a leading exporter of
as a source of energy. It is also tricky   Encouraging competition between                   hydrogen like Australia, Netherlands,
to move around due to its lightness.       the players will also reduce the cost.            Canada and USA.
Lastly, it is a highly flammable and       Mass production of volumes can
volatile substance that cannot be          also play a role in this regard. Tirtha
                                                                                             Author
easily detected as it is colourless and    Biswas, Program Lead, Council on                  Ms. Nikhaar Gogna, She is working as
odourless.                                 Energy, Environment and Water, adds:              a writer/editor with Trade Promotion
                                                                                             Council of India, an organisation
Winning the clean energy                   The approach that the hydrogen                    recognised by the Ministry of
prize                                      economy should take is also a                     Commerce and Industry
                                           function of how a country’s industrial
While it is true that green hydrogen is    structure is currently and what it is             (Reproduced with permission from Trade
costly, it is a promising bet to a much    likely to be 20 years down the line.              Promotion Council of India, 25th May
more sustainable and cleaner future.       For example, Europe might not have                2021)

                                                                                                            Alkali Bulletin May 2021 | 9
Researchers find Novel Way to convert Single Use Plastics

Researchers from the University           The work, reported in a paper in          “Chemical conversion is the most
of Delaware’s Center for Plastics         Science Advances focuses on using a       versatile and robust approach to
Innovation (CPI) have developed a         novel catalyst and unique process to      combat plastics waste,” said Dion
direct method to convert single-use       quickly break down these hardest-to-      Vlachos, the project principal
plastic waste — plastic bags, yogurt      recycle plastics, known as polyolefins.   investigator and the Unidel Dan Rich
containers, plastic bottles and bottle    Polyolefins account for 60 to 70          Chair in Energy Professor of Chemical
caps, packaging and more — to             percent of all plastics made today.       and Biomolecular Engineering at UD.
ready-to-use molecules for jet fuels,
diesel and lubricants.                    Litter, including plastic waste, is a     Creating ready-to-use
                                          global and local problem. This bottle     molecules
Millions of tons of plastic end up        was in the Brandywine Creek in
in landfills every year. It’s a big       Delaware.                                 The UD research team used a
societal problem and an even larger                                                 chemical process called hydrocracking
environmental threat.                     The UD-developed process requires         to break down the plastic solids into
                                          approximately 50 percent less energy      smaller carbon molecules. Catalytic
In the United States, less than 9         than other technologies, and it doesn’t   cracking is not new. Refineries have
percent of plastic waste is recycled.     involve adding carbon dioxide to the      used it to convert heavy crude oil into
Instead, more than 75 percent of          atmosphere, an emissions savings over     gasoline for years. The research team’s
plastics waste ends up in landfills and   other commonly used techniques. It        method also converts the material into
up to 16 percent is burned, a process     can be done in just a couple hours at     branched molecules that allow them
that releases toxic gases into the        low temperature, around 250 degrees       to be more directly translated into an
atmosphere.                               Celsius.                                  end product.

10 | Alkali Bulletin May 2021
“This makes them ready-to-use              in our quest for depolymerization        match thanks to researchers at UD’s
molecules for high-value lubricant         processes that involve less energy       Center for Plastics Innovation. The
or fuel applications,” said Vlachos,       intensive pathways and generate          UD research team’s method can treat
who also directs the Delaware Energy       highly specific breakdown targets,       a variety of single-use plastics, even
Institute and the Catalysis Center for     said CPI director LaShanda               when they are mixed together, a plus
Energy Innovation at UD.                   Korley, Distinguished Professor of       considering the way recyclables are
                                           Materials Science and Engineering        managed. Another first step is getting
The catalyst itself is actually a hybrid   and Chemical and Biomolecular            people not to litter.
material, a combination of zeolites        Engineering. “This fundamental
and mixed metal oxides.                    understanding opens up a new route       Next steps in the CPI research include
                                           toward plastics waste valorization.”     exploring what other plastics the
Zeolites are known to have properties                                               team’s method can treat and what
that make them good at creating            Hard-to-recycle plastics, such as        products it can make. Fuels, such as
branched molecules. Mixed metal            plastic bags, may have met their         diesel and jet fuel, are among the
oxides, meanwhile, are known for           match thanks to researchers at UD’s      possible end-products enabled by the
their ability to break down large          Center for Plastics Innovation. The      UD researchers methods.
molecules just the right amount            UD research team’s method can treat
without overdoing it. “Alone these         a variety of single-use plastics, even   “As this circular economy gets going,
two catalysts do poorly. Together, the     when they are mixed together.            the world will need to make fewer
combination does magic, melting the                                                 original plastics because we will be
plastics down and leaving no plastic       Andrew Danielson, a UD senior            reusing materials made today into the
behind,” Vlachos said.                     chemical engineering major involved      future,” he said.
                                           in the project said, “Plastic waste
The team’s catalyst materials are          is a serious environmental issue. I      “We want to use green electricity
commonly used and, therefore, fairly       believe that this research can help      to drive the chemical processing
inexpensive and abundant.                  lead to better methods of plastic        involved in making new things. We
                                           repurposing,” said Danielson, whose      are very far away at the moment from
“These are not exotic materials, so                                                 seeing this, but that’s where we are
                                           contributions to the work included
we can quickly start thinking about                                                 headed over the next 10 to 20 years,”
                                           verifying the data collected during
how to use the technology,” he said.                                                Vlachos said.
                                           the project by reproducing the
He and Liu have filed a provisional
                                           experiments.                             Co-authors on the paper include
patent on the novel bi-catalyst
and unique method through UD’s             Following graduation in May,             Sibao Liu, a former UD postdoctoral
Office of Economic Innovation and          Danielson will put this research         researcher, now an associate
Partnerships.                              experience to work in the chemical       professor of chemical engineering
                                           industry. He’s already landed a          and technology at Tianjin University;
Sustainable solutions, circular            job in process controls, a part of       and CPI researchers Pavel Kots, a UD
economy                                    the manufacturing process that           postdoctoral fellow; Brandon Vance,
                                           involves controlling variables,          a UD graduate student; and Andrew
Reducing plastic waste by chemically                                                Danielson, a senior majoring in
converting it to fuels can play a          such as temperature, pressure and
                                           conductivity, among other things.        chemical engineering.
powerful role in driving a circular
economy. “This innovative catalytic                                                 (Reproduced with permission from
                                           Hard-to-recycle plastics, such as
approach is a significant advance                                                   Chemical Today, 6th May 2021)
                                           plastic bags, may have met their

                                                                                                Alkali Bulletin May 2021 | 11
India-EU Economic Relations: A New Chapter Unfolds
                                                                                                Sakshi Garg, Researcher

After an eight-year hiatus, India and
the European Union have relaunched
talks on trade and investment issues.
The scope of India-EU partnership
goes much beyond trade & commerce
to cover digital, energy, transport and
people-to-people connectivity.
• The European Union is India’s
  largest trading partner, while India
  is its tenth largest trading partner
  for merchandise trade. Germany,
  Belgium, Netherlands, France and
  Italy are India’s top trading partners
  in the EU.
• Merchandise trade between
  India and the EU has witnessed a
  lackluster performance, hovering
  around the US$ 90 billion figure
  since a decade. Trade in services
  between India and the EU, though,
  is gaining increasing importance in
  their economic ties. India is a net      bilateral economic relations.            2019-20, the bilateral trade stood
  exporter of services to the EU.                                                   at US$ 90 billion, of which India’s
                                           India and EU began negotiations on       exports to and imports from EU
• As India and the EU restart              a Broad-based Trade and Investment       were at US$ 44.9 billion and US$ 45
  negotiations on trade, it is hoped       Agreement (BTIA) first in 2007.          billion, respectively. Trade between
  that they will be able to leverage       However, the negotiations came           India and the EU has witnessed a
  their trade potential better.            to a halt in 2013 over a number          lackluster performance, hovering
• The revitalized partnership could        of differences. Although dialogue        around the US$ 90 billion figure since
  be a driving force for development       continued in the subsequent years,       a decade (Figure 1).
  in the Indo-Pacific. The scope of        yet it is only now that India and EU
  India-EU partnership goes much           have decided to resume negotiations      Within the EU, Germany is India’s
  beyond trade & commerce to               for a balanced, ambitious,               most important trade partner,
  cover digital, energy, transport and     comprehensive and mutually               accounting for almost a quarter of
  people-to-people connectivity.           beneficial trade agreement. They will    India’s trade with the grouping. The
                                           also be launching negotiations for two   other top trade partners are Belgium
A new chapter is set to unfold in
                                           separate agreements on investment        (16%), Netherlands (13%), France
the history of India-European Union
                                           protection and geographical              (13%), Italy (11%) and Spain (6%).
economic relations. The adoption of
                                           indications.
the EU Strategy for Cooperation in the                                              Coming to the composition of trade,
Indo-Pacific in April this year implies                                             in 2019-20, product categories
                                           Merchandise trade
deeper engagement between India                                                     having the largest share in India’s
and the EU as India is an important        The European Union is India’s largest    export basket were petroleum oils;
actor in the geopolitical framework.       trading partner globally, while India    organic chemicals; machinery and
Secondly, the collective decision to       is EU’s tenth largest trading partner    mechanical appliances; gems and
relaunch trade talks at the recently       for merchandise trade. India’s trade     jewellery; electrical machinery; and
concluded India-EU Leaders meeting         with the EU accounts for about 11%       apparels. It is worth noting here that
is expected to give a fillip to the        of its total trade with the world. In

12 | Alkali Bulletin May 2021
India’s trade with the European Union over the last decade (in US$ billion)                 18 billion) worth of services, thereby
                                                                                            running a trade surplus of € 2.9
                                                                                            billion with the grouping.

                                                                                            Similar to the case of merchandise
                                                                                            trade, India’s top trading partners
                                                                                            in the EU in services are Germany,
                                                                                            Netherlands, France, Sweden,
                                                                                            Belgium, Italy, Ireland and Finland.
                                                                                            Globally, Germany was India’s top
                                                                                            destination for exports of transport
                                                                                            and logistics services, Netherlands for
                                                                                            engineering and construction services
                                                                                            and France for maintenance and
                                                                                            repair services.

                                                                                            In 2019, other business services,
Source: Ministry of Commerce and Industry                                                   which include research and
                                                                                            development, legal, accounting,
                                                                                            management consulting, technical
Table 1- India’s top trade partners in the EU in 2019-20 (in US$ billion)                   and trade-related services was the
                                                                                            largest exported service category
Country      Exports Share     Imports Share                        Total     Share in      by India to the EU, running a huge
                     in total          in total                     trade     total trade   positive trade balance. The other
                     exports           imports                                with the      top exported categories were
                     to the EU         from the                               EU            telecommunications, computer
                                       EU                                                   and information; transport; and
                                                                                            travel. Coming to imports from the
 Germany     8.3     18%       13.7    30%                          22.0      24%
                                                                                            EU, the top service categories were
 Belgium     5.8     13%       8.9     20%                          14.7      16%           telecommunication, computer and
 Netherlands 8.4     19%       3.4     8%                           11.8      13%           information followed by transport;
 France      5.1     11%       6.2     14%                          11.3      13%           other business services; travel; and
                                                                                            charges for the use of intellectual
 Italy       5.0     11%       4.5     10%                          9.5       11%           property.
 Spain       3.9     9%        1.6     4%                           5.6       6%
 Poland      1.5     3%        0.8     2%                           2.4       3%            Stumbling Blocks
 Sweden      0.7     2%        1.1     2%                           1.9       2%            A study[3] estimates that a Free Trade
 Denmark     0.7     2%        0.6     1%                           1.4       2%            Agreement between India and EU
                                                                                            in goods and services would lead
 Ireland     0.5     1%        0.6     1%                           1.1       1%            to additional gains in the range of `
Source: Ministry of Commerce and Industry                                                   8 billion (US$9.72 billion) to ` 8.5
                                                                                            billion (US$10.32 billion) for both the
                                                                                            EU and India. So, what has kept India
about 13% of the total exports to the          Trade in Services                            and EU from realising these gains?
EU were of the commodity “other
petroleum oils and oils obtained from          Trade in services between India              • High tariffs: Around 42% of India’s
bituminous minerals’ (HS 271019)               and the EU is gaining increasing               exports to the EU enjoy low tariffs
alone. As regards India’s import               importance in their economic                   under EU’s General GSP scheme.
basket from the EU, the top products           ties. Particularly for India, EU is            India’s highest exports to the EU
are machinery and mechanical                   an important export destination,               under this preferential arrangement
appliances; diamonds; aircrafts;               accounting for more than 25% of its            are of apparels, machinery and
electrical machinery; and instruments          total service exports. India is a net          appliances, footwear, articles of
used for optical, photographic,                exporter of services to the EU. In             leather and plastics.
checking precision, medical and                2019, India exported services worth €
                                               17.7 billion (US$ 21.5 billion) to the       This is, however, a temporary
surgical purposes.                                                                          arrangement as the preferences are
                                               EU and imported € 14.8 billion (US$

                                                                                                        Alkali Bulletin May 2021 | 13
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