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Hercules' division sets up chemical plant in India

Fakir Chand in Bangalore

The BetzDearborn division of Hercules Inc, the $3.2-billion US-based world leader in specialty chemicals, has set up its manufacturing facility at Hoskote on the outskirts of Bangalore to produce advanced specialty chemicals for its growing list of Indian customers and export markets.

With an investment of $3-million in the state-of-the-art plant, the wholly-owned Indian subsidiary will cater to the hydrocarbon processing, primary metals, power, automotive, and general manufacturing industries across the country. The company claims to have a customer base of about 140 customers in India, including Reliance Industries, Thermax, MCF, and MRPL.

According to BetzDearborn's Asia-Pacific vice-president Patrick M Houston, the plant will also provide the pulp and paper division of the parent company with process treatment products to support the rapidly growing market for those chemicals in the Indian subcontinent, in addition to water treatment chemicals.

"The upfront investment has created an installed capacity of 10,000 tonnes though the initial capacity utilisation will be around 3500 tonnes with a provision to scale up the production keeping in view the domestic demand. After fulfilling our local commitments, we will embark on exporting our product range to the Gulf and African markets," Houston affirmed in Bangalore.

Used for water and process systems by industrial and commercial establishments worldwide, the company's engineered solutions include extensive problem-solving resources, application services, and advanced technologies to enhance its customers' productivity, product quality, and environmental performance.

BetzDearborn's Indian Ocean regional director Derek W Stott disclosed in Bangalore on Monday that the company had already made its first sale from the new plant to Praxair India, the industrial oxygen plant set up at the Jindal Vijayangar Steel Plant (JVSL) in the Bellary district of northern Karnataka.

In the face of stiff competition from global competitors like Nalco, the company has decided to step up the indiginisation process for higher content of local materials. "The import content will go up from the present 50 per cent to 70 per cent gradually for minimising the import tariff burden which is around 43 per cent now," said Hercules Specialty Chemicals (India) Ltd managing director Nandkumar Dhekne.

Though the Indian plant is the seventh such facility in the Asia-Pacific region, the parent company plans to outsource its product range for its global markets in the years to come as its production cost will be competitive on account of its high level of automation and faster output cycles.

"The Bangalore plant is equipped with quality assurance laboratory consisting of the latest scientific instrumentation for testing incoming raw materials and outgoing products," Stott affirmed.

Company officials, however, declined to give revenue projections or the time schedule for break-even of the Indian subsidiary. With an authorised capital of $4-million, and a paid-up equity of $1.4-million, the company raised a substantial amount of funds through debt from banks and financial institutions.

During the calendar year 2000, BetzDearborn division worldwide accounted for a revenue of $900 million, and the Pulp & Paper division of Hercules generated a revenue of $1.2 billion.

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