Mr. Jai Hiremath, President, ICC welcomed the members to the Third Meeting of the Committee.

The list of the Members who attended the Meeting is given at the end of the Minutes.

LEAVE OF ABSENCE :

The leave of absence was granted to Mr. Samir Somaiya, Mr. N. Subramanian, Mr. Ravi Kapoor, Mr. R. P. Sethi, Mr. Ashok M. Kadakia, Mr. Y. M. Kothari, Mr. Shankar Ray, Mr. Harish Badami, Mr. Ravi Goenka, Mr. S. V. S. Ramaraju, Mr. R. M. Muthukaruppan, Mr. D. P. Patra, Mr. A. S. Didolkar, Mr. Hasit Dani, Mr. S. Abhaya Kumar, Mr. N. B. Godrej, Mr. Z. F. Lashkari, Mr. K. K. Maheshwari, Dr. Prakash Trivedi, Mr. J. D. Palod, Mr. B. Chattopadhyay, Mr. G. P. Mohapatra, Mr. T. Malhotra, Mr. S. A. Luthra, Mr. Ramakrishnan Mukundan, Mr. Narendra Vachharajani, Mr. Prakash Hiranandani, Mrs. Sandra Shroff, Mr. D. Dutta Gupta and Dr. D. M. Wakankar.

President informed the members that Mr. Bijoy Chatterjee, Secretary, Department of Chemicals & Petrochemicals, Ministry of Chemical & Fertilizers, Government of India has accepted ICC's invitation to meet the Committee members and discuss current issues faced by the industry and therefore solicited members suggestions for the issues that needs to be taken up during presence of Secretary – DCPC. Accordingly, suggestions were made by the members which are summarized below :

Export Benefits :

• The energy cost in India is very high and is also expensive than China, Korea and energy intensity is about 12% in cost of production which makes the industry uncompetitive.
• Interest cost in India is also very high.
• To help the chemical exporters, benefits granted to Gems & Jewelry and Textile sectors should be granted to chemical exporters
• Upward revision in DEPB rates from 5% to 10%.
• EXIM Bank and other commercial banks have also gone into freeze mode and credit availability is very big issue. Commercial banks needs to be advised to be alert for industries' requirements.
• Chinese chemical industry has been recently granted stimulous package of US $ 800 billion and support given in India does not match Chinese stimulous package. Some of the incentives given to the Chinese exporters may be provided to Indian chemical industry as well.
• Exports to Europe are facing serious challenge because of REACH Policy and Government should consider subsidizing the cost involved so as to be REACH compliant.

R&D Support :

• India has acquired significant position in speciality chemical sector especially in Pharma and Agrochemicals and R&D efforts needs to be recognized and compensated adequately. This will be in the form of soft loans where interest rate will be less and will carry longer moratorium period and longer repayment period.

Customs Duty :

• Duty on Naphtha and LNG for the chemical sector needs to be reduced to zero % as it is done for fertilizer and power sector but chemical industry is excluded. This anomaly needs to be corrected.
• Alcohol is renewable feedstock for chemical industry and duty on Alcohol also needs to be reduced to zero %.

Excise Duty :

• Government has reduced excise duty to 8% which is good initiative for stimulating demand, however, Molasses which is raw material for Alcohol based chemical industry is still attracts ad valorem duty of Rs. 750/PMT. Excise duty on Molasses should be refined to 8%.
• The excise duty on Polymers has been brought down to 8%, same is at 16% on Naphtha which is the input for the industry. As a result there is a distortion in CVD as well and hence excise duty on Naphtha should be brought down to 8%.

FTAs :

• FTAs are not in the interest of the chemical industry. Experience with Thailand indicates that Thailand has received maximum benefits compare to India.
• Ethyl Acetate included in the Singapore FTA for import duty, lower duty adversely affected Ethyl Acetate manufacturers.

Safeguard & Antidumping Duty :

• There is surge in import on certain chemicals from China, Taiwan, Korea etc. Besides countries like Columbia, Mexico are also now dumping chemicals into India.
• The procedure for levying these duties is very time consuming.

Non-Tariff Barriers :

• Government should support industries' suggestions for non tariff barriers such as :
  • Analysis of impurities in chemicals
  • Import of chemicals through designated ports
  • Labeling in different languages in India

MEETING WITH MR. BIJOY CHATTERJEE, SECRETARY, DCPC, MINISTRY OF CHEMICAL & FERTILIZERS, GOVERNMENT OF INDIA :

President welcomed Mr. Bijoy Chatterjee, Secretary, DCPC, Dr. Chakravarty and Mr. P. S. Singh, Dy. Secretary to the Government of India who have kindly attended the meeting and thanked all of them for sparing their valuable time even on holiday for meeting ICC members.

President and other members brought to the notice of the Secretary and other officials the issues that are currently faced by the chemical industry as mentioned above.

Secretary thanked the members for various suggestions and responded as follows :

• Secretary appreciated difficulties faced by the industry regarding availability of credit both long term and working capital and for exports. Secretary assured that at appropriate levels he will take up the issue.
• Secretary agreed to examine the suggestions regarding custom duty reduction on Naphtha, Industrial Alcohol and excise duty reduction on Molasses and Naphtha.
• As far as exports to Europe are concerned, he suggested that ICC should indicate precisely as to how the Government should help the exporters in complying with REACH.
• As far as surge in import is concerned, it was said that across the board duty increase is not possible and industry should take up safeguard and antidumping mode for protecting the domestic industry. Secretary assured for quick disposal of such applications.
• Government has agreed in principle to enter FTAs in view of its commitment for globalization, however any specific products which India has manufacturing strength be communicated to the Ministry for exclusion in the FTA.

President thanked Secretary and his team and assured that ICC will send detailed note to office of the Secretary – DCPC as early as possible.

Thereafter members agreed to set up Task Force for examining various suggestions made as follows :

1. R&D Jubilant Organosys Ltd & Hikal Ltd
2. Banking & Working Capital Jubilant Organosys Ltd & Hikal Ltd
3. Duty Reduction Jubilant Organosys Ltd & Reliance Industries Ltd
4. REACH ICC Expert Committee
5. FTAs Reliance Industries Ltd & Jubilant Organosys Ltd

Mr. R. M. Pandia, Past President, ICC agreed to give contact details of Indian Embassy in China for collecting authenticated data on stimulous package given by China.

Thereafter agenda was taken up for discussion.

CONFIRMATION OF THE MINUTES :
Minutes of the Second Meeting held on 29 January 2009 at Baroda were confirmed.

ACTIVITIES UNDERTAKEN DURING THE INTERVENING PERIOD :
Members noted activities undertaken during the intervening period (copy attached).

PRESENTATIONS BY EXPERT COMMITTEE CHAIRMEN :
Expert Committee Chairmen briefed the members about activities carried out by their Committee as follows :

I. Technology & Energy Expert Committee :

Mr. S. R. Lohokare, Chairman, Technology & Energy Expert Committee briefed the members about seminars the Committee has arranged :

1. One-day program in cooperation with FORBES MARSHALL held on "CARBON CREDITS FROM STEAM SAVINGS REVISIT ENERGY CONSERVATION PLANS" on 5 December 2008 at Bangalore.
2. One-day program in cooperation with FORBES MARSHALL held on "CARBON CREDITS FROM STEAM SAVINGS REVISIT ENERGY CONSERVATION PLANS" on 24 February 2009 at Kurkumbh, Pune.
3. One-day Refresher Course on "Process Intensification" held on 7 March 2009 at Mumbai.

Chairman further said that his Committee has plans to arrange seminar on "Electricals" some time in April / May 2009 and also repeat program on "Process Intensification" at Vadodara. He further said that seminar on "Process Intensification" will also be arranged at different centres of ICC.

II. Safety, Health & Environment Expert Committee :

Mr. S. K. Hazra, Chairman, Safety, Health & Environment Expert Committee briefed the members about Seminar / Presentation the Committee has arranged :

1. One-day seminar on "Chemical Industry – Addressing Security Threats" on Friday, 6 February 2009 at Mumbai. Ms Orna Sagiv, Consul General of Israel in Mumbai inaugurated the seminar. Mr. Suresh S. Bheema, General Manager – South Pacific Region, ABS Consulting Inc. delivered Key-Note Address. Mr. Asaf Ashkenazi, Head of Sharvit Division, Rotem Industries Ltd, Israel participated in the seminar and shared best practices followed in Israel.
2. Presentation by Mr David A. Moore, PE, CSP, AcuTech Group, Inc. on "Chemical Industry Management"was arranged on 9 March 2009 at ICC – Mumbai Office Chairman further informed the members that request has been received from Gulf Petrochemical Council for sending expert on "Responsible Care" for training the manufacturing companies there in Dubai and Committee agreed in principle to this proposal and note will be sent to Gulf Petrochemical Council for their response.

Chairman also referred to the proposal regarding setting up of Centre for Process Safety which is under consideration of the Council and said that in view of delay involved in setting up the Centre for Process Safety with Center for Chemical Process Safety (CCPS), USA and IChemE, UK, Committee felt that ICC on its own should start Process Safety Centre and later on may consider inviting CCPS to join it. Committee approved the proposal and advised Secretariat was advised to communicate decision of the Council to CCPS and request their feedback within two weeks.

III. Trade & Business Development Expert Committee :

Mr. S. K. Ray, Chairman, Trade & Business Development Expert Committee informed the members about program arranged on "ANTI-DUMPING AND SAFEGUARDS DUTIES MEASURES" held on 21 February 2009 at Mumbai which was conducted by Mr. A. K. Gupta who is renowned authority on Safeguard and Anti Dumping Measures. Chairman further said that similar type of seminar will be organized in Chennai on 11 April 2009 and modalities in this behalf are being worked out.

Chairman referred to the letter received from Commerce Ministry regarding Non-Agriculture Market Access (NAMA) proposal and informed that the said letter has been circulated to the Committee members for their comments so as to reach ICC – Mumbai Office on 20 March 2009. A meeting has been convened on Thursday, 26 March 2009 at Mumbai for discussing NAMA proposal and inputs from the members will be extremely useful.

Chairman further informed that a Task Force has been set up to recommend proposals for budget recommendations.

IV. International Treaties Expert Committee :

Mr. S. Ganesan, Chairman, International Treaties Expert Committee referred to the global chemical trade and insignificant share of Indian chemical industry. He also said that members need to be responsive to various International Treaties that are in the pipeline which will affect their business. He also handed over booklet prepared by ICC regarding global chemical industry which was circulated to the members. Chairman further said that industry should also follow Non Tariff Barrier route for protecting the industry.

PROPOSAL PREPARED BY TASK FORCE REGARDING SPRUCE :

Members noted that Task Force consisting of Mr. S. K. Hazra, Dr. Prakash D. Trivedi, Mr. D. P. Misra and Mr. Sujit Patil met two times and as a first step towards implementing image building exercise for ICC as well as chemical industry it was decided to revamp ICC website. The proposal submitted by Turtle & Hare Communication Management & Co. was also approved. It involves expenses of the order of Rs. 6.50 lakhs and Secretariat was advised to take further steps and also discussed the structure. It was decided to circulate document received from Turtle & Hare Communication Management & Co. to all the Committee members soliciting their suggestions for revamping ICC website.

MoUs WITH SOCIETY OF CHEMICAL INDUSTRY (SCI) AND NORTH EAST PROCESS INDUSTRY CLUSTER (NEPIC) LTD, UK.

Committee noted proposal for entering into MoUs with Society of Chemical Industry (SCI) & North East Process Industry Cluster (NEPIC) Ltd, UK. and agreed for the same. Secretariat was advised to take appropriate action. VISIT OF ICC DELEGATION TO JAPAN :

President informed the members that Japan is looking out to India for the purpose of investments and ICC should take a delegation to Japan at a suitable time convenient to ICC and Japan Chemical Industry Association. Members agreed to the proposal and authorized President to take suitable action for deciding date of the visit, duration of visit, specific areas of interest of delegation, etc.

MEMBERSHIP MATTERS :

Following companies were admitted to the membership of the Council with effect from 1st April 2009 :

Admission Associate Membership (Others):
Chemsynergy India Pvt Ltd, Pune
MAN Turbo India Pvt Ltd, Vadodara

ANY OTHER MATTER WITH THE PERMISSION OF THE CHAIR :

1. President informed the members that need is felt for ICC for having its own office in Vadodara for Gujarat Chapter. Due to efforts of Mr. Ravi Kapoor, Chairman – Gujarat Chapter premises admeasuring 1250 sq. fts. + 250 sq. fts. open balcony have been identified and cost of the same is Rs. 27.50 lakhs. Besides, ICC will also be required to incur expenses of the order of Rs. 1 lakh towards registration and brokerage charges and Rs. 10 lakhs for carrying out alteration in the premises to suite ICC's requirements at a later date. Members approved the proposal and authorized Secretariat to take further steps for acquiring premises.
2. Members expressed view that there is great potential for ICC to earn income by issuing Certificate of Origin as other bodies are earning in crores. Secretariat was advised to take effective steps for generating income from this source.
3. President informed the members that ICC - Mumbai Office needs renovation and Secretariat was advised to call architect for preparing plan, drawing and estimates. Committee noted the same and authorized Secretariat to finalize in consultation with the President.
4. President informed the members that in response to the appeal for contribution towards Crisis Fund, Secretariat so far received Rs. 25.70 lakhs from 39 members. Secretariat was advised to do continuous follow up and request prominent members who are active in ICC through various Expert Committees to consider contributing amount.
5. Members were informed about 2ND Annual India Chemical Industry Outlook "Vision 2020 for the Indian Chemical Industry" organized in cooperation with Chemical Week - a leading international magazine for chemical industry and Chemical & Petrochemical Manufacturers Association (CPMA) to be held on 22-23 April 2009 at Hotel JW Mariott, Mumbai. Members were informed that Mr. Bijoy Chatterjee, Secretary, DCPC, Ministry of Chemical & Fertilizers, Government of India has agreed to inaugurate the conference and detail program was also informed to the members by Mr. D. P. Misra.
6. Members expressed the view that ICC should explore possibility of accepting delegates via video conferencing for various seminars in future.
7. Mr. D. P. Misra was presented a photo album and Mr. Misra will be special invitee for all the Executive Committee meetings that will be held till next Annual General Meeting.

DATE AND VENUE OF THE NEXT MEETING :
It was decided to organize Fourth Meeting of the Executive Committee on 29 May 2009 at Mumbai.
Since there was no other matter to discuss, the meeting concluded with a Vote of Thanks to the Chair.

MEMBERS PRESENT :