BASF partners with Adani to evaluate investment in acrylics value chain in India

BASF and Adani have signed a Memorandum of Understanding on the eve of the Vibrant Gujarat Summit 2019 to evaluate a major joint investment in the acrylics value chain, which would be BASF’s largest investment in India to date.

According to the Memorandum of Understanding, BASF and Adani want to establish a joint venture with an investment totalling about €2 billion, in which BASF will hold the majority.

The potential investment comprises the development, construction and operation of production plants including PDH, GAA, BA and other downstream products.

The products are predominantly for the Indian market to serve a wide range of local industries, including construction, automotive and coatings, whose growing demand is currently supplied via imports.

Guatam Adani, Chairman of Adani, said: “India continues to be a very large importer of petrochemicals given the rapid expansion of the middle class, and this leads to a significant outflow of precious foreign exchange. Our partnership with BASF is a big step forward in enabling our country’s ‘Make In India’ programme, as this partnership will allow us to produce in Mundra several of the chemicals along the C3 chemical value chain that we are currently importing. Mundra’s infrastructure is ideally suited to enable chemicals production, and our ability to deliver renewable power makes this a unique partnership on several fronts.”

Dr. Martin Brudermuller, Chairman of the Board of Executive Directors at BASF, said: “BASF’s intention to invest in a major new site for the acrylics value chain in India clearly demonstrates our strong and long-term commitment to our Indian customers. Together with the Adani Group, we would have the opportunity to provide our customers with high-quality chemicals and support them in growing their business. With our production powered by renewable energy, we would be able to minimise our impact on the environment.”

In line with BASF’s carbon neutral strategy growth strategy, the chemical site in Mundra would be the company’s first CO2-neutral production site, and the two companies have developed an overall plan including new technologies and the supply of site with 100 per cent renewable energy.