Having consistently recorded over 8.5% GDP growth for the past 5 years, India, along with China, is leading the economic growth tables among the major global economies,. In 2008, both these emerging economies are set to record marginally lower, but close to 8% economic growth in a generally gloomy economic environment and times of severe financial turmoil. In contrast, the global economy is seen to be slowing down considerably and USA along with Europe is suspected to be sliding towards a recession,. This is causing a realignment of economic pattern. That along with structural changes in the energy and petrochemical markets have brought to the fore significant challenges for our industry.

The first relates to demand growth and the industry cycle. These past five years have been very productive for the petrochemicals sector. On the one hand, global demand has grown rapidly; Ethylene @ 3.6 % pa, propylene @ 4.5 % pa, PX @ 4.2 % pa and benzene @ 3.6 % pa. On the other hand, on the supply side, the growth has been slower. New capacities have slowed down as a result and therefore margins have been healthy. With the global economy slowing down, there are some fears that the petrochemical cycle may turn.

However, that India and China are holding up with strong economic performance in this time of crisis is good news for the global economy, the commodity sector and in particular, petrochemicals .This is because during the last upturn, Asian countries contributed a major proportion of demand growth in petrochemicals. Thus, demand growth for petrochemicals can be expected to taper only modestly, over the next couple of years, before continuing back on its robust growth trajectory witnessed over the past several years.

The second challenge is relating to shifting supply dynamics. Capacity expansions continue to be announced today though selectively. The Middle Eastern countries are aggressively pursuing new projects to leverage their feedstock advantage. Over the next 10 years or so, Middle East will control 15-25% of the most competitive global petrochemicals capacity. On the other hand, the consuming economies are adding new capacity of their own based on growing domestic demand. The petrochemical industry needs to adjust quickly to this major restructuring in the operating and trade structure.

The third challenge relates to high energy prices. Crude oil peaked at $145/bbl before backing off to levels below $100/bbl. Though lower, the crude price and therefore energy and raw material costs for petrochemical producers are at levels significantly higher than witnessed ever before in history. This paradigm shift in business dynamics has challenged conventional thinking in petrochemicals and is causing large players to reexamine their business models. The EPC industry, not be left behind, has caused an upheaval in the projects markets. The EPC costs and margins are at their peak and schedules are suffering.

Different strategies are being adopted by companies to remain competitive in this new and changing world, from innovation in project implementation, to redesign of operating strategies, innovation in feedstocks new and innovative catalyst solutions. Therefore, petrochemical competitiveness in the high energy cost scenario is the principle themes of Indian Petrochem - 2008, the 10th International conference, which is jointly organised by Elite Conferences and CPMA (Chemicals & Petrochemicals Manufacturers' Association of India). We have invited eminent speakers to debate the responses of the petrochemical community to the environmental changes at this forum.

As in our previous conferences, this dedicated forum aims to bring together Indian and international petrochem fraternity and deliberate on the outlook and challenges facing the industry. Over these years, the conference has received your overwhelming support and has become an important meeting point for the industry. We are sure that this year too as in the previous events, we will receive your growing support.

We warmly invite you to participate in this conference.