Key facts
- India may extend its petrochemical import duty waiver beyond the June 30 deadline.
- The potential extension is contingent on persistent supply disruptions linked to the Iran war.
- The waiver, implemented in April, covers 40 petrochemical products including PE, PP, and PVC.
- Indian PE importers have reduced purchases due to uncertainty surrounding the waiver's future.
- Domestic production of certain petrochemicals is hampered by feedstock constraints, impacting supply reliability.
The Indian government is contemplating an extension of its waiver on import duties for petrochemical products, a measure currently set to expire on June 30. This potential extension is being considered in light of ongoing supply disruptions stemming from the conflict in the Middle East, particularly concerning Iran. A senior official from India's commerce department indicated that New Delhi is closely monitoring the situation and remains open to prolonging the temporary relief.
The duty waiver, which came into effect in April, applies to 40 petrochemical items, including polyethylene (PE), polypropylene (PP), and polyvinyl chloride (PVC). Its purpose is to offset increased costs for domestic industries. Some plastic converters have formally requested an extension of this waiver until September 30, with a final government decision anticipated in the coming weeks.
Uncertainty over the waiver's future has led Indian PE importers to slow their purchasing activities. Similarly, PVC import volumes saw a reduction in the latter part of the second quarter, attributed to high domestic resin inventories and the onset of the monsoon season. The reduction in import duties, coupled with improved resin supplies, has contributed to a moderation in polymer prices since the conflict began.
Industry participants note that while an extension could further decrease prices, concerns remain about the sufficiency of both domestic supplies and imports to meet overall demand. Domestic petrochemical production faces challenges due to feedstock constraints, with many Indian PVC manufacturers relying on imported ethylene dichloride (EDC) and vinyl chloride monomer (VCM). The Middle East was a significant source of EDC imports in 2025. The ongoing conflict has raised questions about the reliability of domestic production if Middle Eastern supplies remain inaccessible.