India's Chemical Sector Faces Challenges from China Overcapacity, High Crude Prices, and Weak Global Demand

India's chemical sector faces structural and macroeconomic challenges from China's persistent overcapacity, elevated crude oil prices, and weak demand in key Western markets, according to a Nuvama report. Chinese state-backed producers operate below optimal utilisation, suppressing global prices and limiting margin recovery for Indian firms. Additionally, high crude prices increase feedstock costs, while a stronger Indian rupee reduces export earnings. Slowing demand in Europe and the US across sectors like construction and pharmaceuticals further pressures India's chemical exports.