The Union cabinet on Friday approved a new Rs 3,030-crore scheme to establish three dedicated chemical parks across the country, aiming to strengthen India's chemicals sector through world-class infrastructure, attract investments and boost domestic manufacturing.
The Bharat Audyogik Vikas Yojana Rasayan (BHAVYA Rasayan) scheme, announced in the Union Budget for 2026-27, was cleared by the Cabinet chaired by Prime Minister Narendra Modi, Union information and broadcasting minister Ashwini Vaishnaw said.
Addressing a Cabinet briefing, Vaishnaw said the chemicals sector, much like semiconductors, is a foundational industry for the economy.
"Today, Prime Minister Narendra Modi chaired the Cabinet meeting, which approved two major decisions. The first is the construction of the third and fourth railway lines on a key economic corridor connecting Andhra Pradesh and Karnataka. The second is the approval of a new scheme to develop India's chemicals sector in a completely new way," he said.
"The chemicals sector, like semiconductors, is a foundational industry for the economy. That is why it was important to adopt a fresh approach for its development," the minister added.
Centre to provide up to Rs 1,000 crore per park
According to the government, the scheme will have a total financial outlay of Rs 3,030 crore, of which Rs 3,000 crore will be used to create common infrastructure facilities and basic utilities inside the parks, while Rs 30 crore has been earmarked for administrative expenses.
The scheme will be implemented over five years, from FY 2026-27 to FY 2030-31.
Under the scheme, the Centre will provide a grant of up to Rs 1,000 crore for each chemical park, subject to a minimum contribution of Rs 500 crore by the respective state government.
Vaishnaw said the Centre's financial support is only for creating shared infrastructure and that the overall investment in the three parks would be significantly higher.
Parks to offer plug-and-play infrastructure
The three chemical parks will be developed by state governments through a challenge route. Each park will require a minimum of 8 square kilometres (2,000 acres) of contiguous, encumbrance-free land.
The parks will provide plug-and-play infrastructure tailored for the chemical industry, including:
- Common Effluent Treatment Plants (CETPs)
- Treatment, Storage and Disposal Facilities (TSDFs)
- Water supply and distribution systems
- Solvent recovery and distillation facilities
- Steam generation and distribution networks
- Interconnected pipeline networks
- Logistics and warehousing facilities
The government said the shared infrastructure is expected to reduce costs, improve operational efficiency and enhance the global competitiveness of India's chemical industry.
Aim is to boost manufacturing, exports and jobs
The scheme is designed to develop the entire chemical value chain, including upstream, downstream and ancillary industries, while improving resource utilisation and lowering logistics costs.
The government said the initiative would help the Indian chemical industry integrate better with global value chains, increase exports, reduce imports and attract both domestic and foreign investments.
It also aims to promote environmentally sustainable industrial development through centralised waste treatment and hazardous waste management infrastructure, ensuring better compliance with environmental regulations.
Recognising that chemicals and petrochemicals serve as critical inputs for sectors such as agriculture, textiles, pharmaceuticals, nutraceuticals, construction, automobiles and electronics, the government said the scheme is expected to generate employment, strengthen domestic production and contribute towards the goal of Viksit Bharat 2047.