Gujarat Emerges As India’s ‘Petro Capital’; Gujarat’s Economic Transformation, From Industrial Hub To Global Investment Magnet, A Model For Other States To Follow
In recent years, Gujarat has undergone a remarkable transformation, evolving into an industrial powerhouse that not only attracts global investments but also serves as a benchmark for other states across India. The state has witnessed a surge in Foreign Direct Investment (FDI), reaching a substantial $31 billion USD from 2019 to March 2023, marking an 84% increase in FDI during FY 2022-23—the highest among all states and union territories. Gujarat's success story includes significant achievements in various sectors, from automotive and manufacturing to chemicals, petro, food processing, and diamond processing, solidifying its position as a key player in India's economic landscape. The state's annual Vibrant Gujarat Global Summit, which started as an initiative to make Gujarat a preferred investment destination, has now evolved into a platform that shapes a new India, drawing global attention and admiration.
Gujarat has earned the title of India’s ‘petro capital,’ owing to its possession of the world’s largest grassroots oil refinery in Jamnagar and the OPaL petrochemical complex located in Dahej, Bharuch district.
Officials highlight that Reliance Industries Ltd’s (RIL) Jamnagar refinery, boasting a crude processing capacity of 1.4 million barrels per day (MMBPD), stands as the largest and most complex single-site refinery globally.
According to RIL’s official website, the Jamnagar refinery complex accommodates some of the world’s largest units, including the fluidised catalytic cracker, coker, alkylation, paraxylene, polypropylene, refinery off-gas cracker, and petcoke gasification plants.
Gujarat Chief Minister Bhupendra Patel emphasized the significant impact of the state’s petrochemical sector on industrial development. Patel stated that the sustainable growth of the chemical and petrochemical sector in Gujarat has outpaced that of other states.
At the Vibrant Gujarat Global Summit (VGGS) in 2019, a Memorandum of Understanding (MoU) worth Rs 3,000 crore was signed for a bio-refinery in the Dahej Petroleum, Chemicals and Petrochemicals Investment Region (PCPIR). After that, a Rs 7,000 crore MoU for chemical manufacturing in Dahej was signed in 2022.
The 10th edition of VGGS is scheduled to take place in Gandhinagar from January 10 to 12 next year, focusing on the theme of ‘Gateway to the Future.’
Chairman & Group CEO of UPL Limited, Jai Shroff, lauded Gujarat’s progressive policies as instrumental in the sector’s remarkable growth.
Shroff stated that thanks to the support from the Gujarat government, major players in the sector have achieved global prominence, noting that Gujarat contributes around 75 per cent of the country’s total dye and intermediates manufacturing due to proactive government policies.
Experts anticipate that with established companies like Reliance, Shell, ONGC, and others having their manufacturing setups in Gujarat, the state will eventually become unparalleled in the chemicals and petrochemicals sector.
The Petroleum, Chemicals and Petrochemicals Investment Region in Dahej, Bharuch district, is one of the four PCPIRs declared by the Centre under the PCPIR Policy 2007.
The Gujarat PCPIR covers an expansive area of 452.98 square km and is well-connected by road, rail, port, and air.
The OPaL facility at the PCPIR is one of South Asia’s largest petrochemical complexes, spanning 5 sq km and having the capacity to produce 14 lakh tons of polymers and 5 lakh tons of chemicals.
While OPaL is the ‘Anchor Tenant’ of PCPIR, it also houses facilities of BASF, ONGC, RIL, Welspun, Pidilite, and GNFC, among others.
Incredible Gujrat
Gujarat’s impressive metamorphosis into an industrial powerhouse has been gaining global attention, solidifying its position as one of the most sought-after states for investments and serving as a blueprint for other regions in the country.
According to official reports, Gujarat attracted a staggering $31 billion USD in Foreign Direct Investment (FDI) from 2019 to March 2023, registering an 84% surge in FDI during FY 2022-23 compared to the preceding year, the highest among all states/UTs.
Key milestones include a remarkable 9-fold surge in investments in the automobile sector since 2001 and a substantial 12-fold increase in manufacturing output.
Gujarat also plays a key role in India’s dyes and intermediates manufacturing, contributing 75%, and leads in agro and food processing investments, boasting over 30,000 operational food processing units.
The state commands more than 50% of medical device manufacturing and an impressive 80% share in cardiac stent production within India.
Moreover, Gujarat holds a significant role in processing over 70% of the world’s diamonds and contributes to 80% of India’s diamond exports.
It dominates the ceramic industry with an impressive 90% market share, hosting over 10,000 units producing diverse ceramic products.
According to Prime Minister Modi, Gujarat stands as India’s largest exporter, with current transactions totalling $2 billion, and the Vibrant Gujarat Global Summit has evolved into one of India’s premier business summits, attracting substantial investments to the state.
Launched in 2003 with the goal of “Making Gujarat a preferred Investment Destination,” the Summit, conceptualized in 2023, has transformed into “Shaping a New India” over the last two decades.
The event, which started with around 300 international participants, now draws more than 40,000 participants and delegates from 135 countries, with the number of exhibition booths skyrocketing from 30 to over 2000.
Vibrant Gujarat’s unparalleled success is now a model for the country, inspiring other states to organize similar investment summits.
Over the past two decades, Gujarat has also emerged as a thriving economic hub propelled by entrepreneurial spirit. It now stands among India’s most industrialized and urbanized states, leading in various sectors and attracting substantial investments.
During the 20th-anniversary celebration of the Summit at Science City in Ahmedabad on September 27, PM Modi and industry leaders reflected on this transformation.
The Japanese Connection
At the event, Takashi Suzuki, Chief Director General of Jetro (South Asia), stressed Japan’s significant contribution to the Make in India initiative and spotlit the strengthening ties between Jetro and Gujarat since 2009.
Gujarat currently hosts nearly 360 Japanese companies and factories, with plans for future collaborations in semiconductor electronics, green hydrogen, renewable energy, and the pharmaceutical sector.
Suzuki mentioned an upcoming visit by a Japanese business delegation focused on semiconductors during the next Vibrant Gujarat event.
On September 12, 2023, the sixth phase of MoUs for industrial investments in the state was signed in Gandhinagar as part of the Vibrant Gujarat Global Summit 2024.
Seven MoUs were inked for the textile sector, chemicals sector, and an industrial park, representing a potential investment of Rs. 4,067 Crores and anticipating the creation of more than 25 thousand employment opportunities. Additionally, on August 8, four more MoUs worth ₹1,113 crores were signed in a single day.
Looking ahead, the Vibrant Gujarat Global Summit 2024, scheduled for January 10th – 12th, aims to carry forward the national priorities and themes of G20 and I2U2, extending its influence and vibrancy at the state, national, and international levels.
