In a major move set to reshape India’s chemicals landscape, Gujarat Narmada Valley Fertilizers & Chemicals Limited (GNFC) has signed a Memorandum of Understanding (MoU) with UK-based INEOS Acetyls International Limited. The agreement, announced on November 20, 2024, paves the way for a joint venture to construct a world-scale acetic acid production plant in Bharuch, Gujarat, with operations targeted to commence by 2028.

The partnership is a strategic response to India’s heavy dependence on acetic acid imports, which currently account for approximately 85% of its annual demand. Pankaj Joshi, Managing Director of GNFC, noted that the new plant aligns with the “Make in India” initiative and is expected to significantly reduce foreign exchange outflows while meeting domestic demand and supporting downstream industries.

Under the terms of the agreement, GNFC and INEOS will each hold a 50% stake in the joint venture company, ensuring an equal partnership in decision-making and operations. The new facility, capable of producing 600,000 tonnes of acetic acid annually, will leverage advanced technologies, capitalising on INEOS’s global expertise and GNFC’s operational presence in India.

David Brooks, CEO of INEOS Acetyls, expressed enthusiasm about the collaboration, emphasising India’s role as a burgeoning market for acetic acid and its derivatives. He highlighted the joint venture’s potential to stabilise supply chains, reduce import reliance, and meet the rising domestic and regional demand for this critical chemical, widely used in food preservation, textiles, and industrial applications.

GNFC, India’s sole producer of acetic acid, has a history of innovation and collaboration with INEOS that spans nearly three decades. This new venture represents a natural progression of their relationship, building on shared technological synergies to address market gaps.

The initiative has broader implications for India’s chemicals industry. By bolstering domestic production capacity, the venture is likely to reduce price volatility caused by import dependency. It could also catalyse growth in ancillary industries and strengthen India’s position as a regional manufacturing hub for acetic acid and its derivatives.

INEOS Acetyls, a recognised global leader in acetic acid production, operates state-of-the-art facilities worldwide, including significant manufacturing units in Europe, North and South America, and Asia. GNFC, promoted by the Government of Gujarat, is a major player in the Indian chemicals and fertilisers sector, contributing significantly to India’s industrial growth since its inception in 1976.

This strategic collaboration underscores the growing importance of public-private partnerships in advancing India’s industrial self-reliance. With the backing of global expertise and localised operations, the joint venture could serve as a blueprint for future international collaborations in the Indian chemicals sector.

  acetic acid, chemicals industry, GNFC, Gujarat, Gujarat Narmada Valley Fertilizers & Chemicals Limited, INEOS Acetyls