India Base Oil Market Analysis: Plant Capacity, Production, Operating Efficiency, Demand & Supply, End Use, Type, Process, Technology, Distribution Channel, Region, Competition, Trade, Customer & Price Intelligence Market Analysis, 2015-2030
India Base Oil demand stood at 3.52 Billion Litres in FY2021 and is forecast to reach 6.09 Billion Litres by FY2030, growing at a healthy CAGR of 6.28% until FY2030. The growing automotive and industrial sector in the country has led to increased demand for Base Oils and lubricants. Base Oil demand is expected to increase with India adopting BS-VI emission norms from BS-IV causing several hardware changes to be introduced in the OEMs to cater to the new emission standards. More than 60 percent of the Base Oil demand in India is satisfied through imports from the Middle East and the U.S. and the domestic market is expected to attract investments from global players like Repsol, Shell, and Exxon over the coming years. Globally, Base Oil is an oversupplied market with the capacity far exceeding the demand however India still lags in its manufacturing facilities. There is an urge in the lubricant sector to replace the current lubricants with new formulations that would reduce emissions. Hence, India is anticipated to witness an increasing demand for Base Oil owing to an increasing preference for automobiles complying with BS-IV emission norms. With significant trade, Group I plant closures, a shift to better performing heavy group Base Oils, the addition of new plant capacities, and technological advancements taking place in MEA manufacturing units, India’s Base Oil demand is expected to show a significant rise over the next five years. COVID-19 pandemic had a severe impact on the market, in general, and disrupted the Indian economy. Rising number of patients suffering from the infection and rapidly evolving virus created death scare for the whole population at large. The government imposed the lockdown to contain the spread of the virus that further resulted in disabling market growth. The transportation modes were closed for a significant amount of time and disturbed the distribution channels and the end-use industries. The government is slowly controlling the consequences, and steadily market is regaining its composure. With a steady CAGR in the upcoming forecast years, the market may grow and present as a potential investment for the new market player that supports the market growth in the future.
‘Make in India’ scheme implemented by the Government of India which is an initiative to foster the growth of indigenous manufacturing sectors in the country is also expected to provide a positive impetus to the Base Oil domestic manufacturers. Moreover, the implementation of GST, which has improved the ease of doing business in the country will catalyze the domestic production of Base Oil. Higher preference for heavy-grade Base Oils than their lighter counterparts for better properties tends to fuel the Grade III and Grade IV demand in the future. Additionally, demand from the industrial machinery and equipment application also drives India’s overall Base Oil market.
Years Considered for this Report:
Historical Years: FY2015– FY2020
Base Year: FY2021
Estimated Year: FY2022
Forecast Period: FY2023 – FY2030
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