Introduction:

Do you know that the chemical sector faces around 635 compliance requirements? These regulations span critical areas such as factory safety, health standards, hazardous materials, explosives, and food safety. You can imagine the complexity of navigating this regulatory landscape- every unit must meticulously meet these standards to operate legally. With such an intricate web of rules, every market player in the chemical industry should be truly prepared for the consequences of non-compliance, or is it time to rethink how industries approach regulation? Could this immense burden be holding back innovation and growth? In this article, we delve into the complex regulatory landscape persisting in our nation and its far-reaching implications for Indian chemical companies. Let’s begin.

The major backbone of Indian agriculture and industrial development:

The chemical sector builds itself as the backbone of the agriculture and industrial sector and comprises over 80,000 products such as pesticides, colourants, and petrochemicals. It contributes over 7% to the GDP and the industry is expected to surpass 300 billion by 2025 and attract over USD 107 billion. Therefore, the industry is also a source of employment for over 2 million people in the country.

Now considering the major hinderances of the sector, they are confronted with a high regulatory burden. For instance, even setting up a chemical manufacturing unit requires many licenses, permissions, approvals, registrations, and certifications. Several categories start from labour, commercial and secretarial to the environment, health, safety, finance, and taxation.

Therefore, small or micro enterprises are facing challenges in this regard that include manual tracking of compliance across plants, lack of clarity on compliance obligations under the factory’s act in EHS categories, frequent statutory notices, manual search for applicable legal updates and others.

List of regulations governing the chemical industry in India:

The regulations span across categories such as safety, environmental sustainability, and overall well-being of workers and the public. Therefore, areas such as quality management, environmental protection, occupational health and safety and control of hazardous substances are taken care of. Therefore, a detailed study of each of the regulations along with the case study helps in understanding how these regulations impact every market player.

The Ministry of Environment, Forest and Climate Change (MoEFCC) introduced the latest version of Indian chemical rules in March 2021 and it is named as chemicals management and safety rules. The rules aim to streamline and consolidate the regulations related to operations such as import, manufacture, storage, handling and transportation of hazardous chemicals. The rules also reinforce sustainable practices across the chemical supply chain.

This latest version of chemical rules highlights the following:
 

As per the regulations, every company must provide the Safety Data Sheets for chemicals they are manufacturing covering information such as properties of the chemicals, potential hazards, safe handling practices, first-aid measures, and disposal instructions and this information helps the workers to understand the risks and take necessary precautions.
 

The companies generally focus on distributing the SDS to employees, customers, and general public and related staff. Therefore the companies generally prefer to put it on their official website connecting the chemicals they have listed.

The SDS is made available to all employees who may be exposed to hazardous chemicals during their work. This can also be made through the distribution of physical copies in the workplace or digital access via the company’s intranet.

Companies provide SDS to downstream users including customers and transporters and ensure anyone who is handling the chemicals.

The SDS are often translated into local languages in addition to English thereby catering to the linguistic diversity of the workforce.

Training and education: Employees are also given proper training on how to comprehend the SDS recognize chemical hazards and then implement safety measures appropriately.

Therefore, the SDS plays a vital role in carrying out emergency response preparedness such as spill response, firefighting techniques, first-aid measures and so on.

Why important: SDS requirements help the companies meet the legal obligations that come under varied regulations such as the Factories Act 1948, and Hazardous and other wastes management rules, 2016.

SDS also includes proper handling and disposal instructions in SDS that contribute to minimizing environmental pollution and promoting sustainable practices.

The detailed information in SDS helps in identifying potential risks and implementing control measures to prevent accidents and exposures.

This also includes Employee safety programs such as training to use PPE, understanding the labelling systems and thereby following proper storage and disposal procedures.

Labelling and packaging:

Like every other industry, labelling and packaging is important in the chemical industry for safety and compliance. Containers must display specific hazardous symbols, precautionary statements and pictograms on their labels. These help the employees and workers to identify the risks and help in handling the chemical products better and transporting them safely.

For example,
A container containing sulfuric acid must contain appropriate labels and information mentioning the risks as they are capable of causing damage. Therefore the container must contain all of the information on its labels:
 

When the containers containing sulfuric acid are labelled with this information appropriately, then they help in immediate hazard recognition and reduce the risk of accidents.

Hindustan Unilever Limited (HUL):

Hindustan Unilever Limited is a major player in the Indian chemical market and consumer goods sector. They adhere to strict label and packaging regulations for all their hazardous materials.

Labelling practices ensure the company shows hazardous chemical products as per the GHS standards. The containers are marked with appropriate hazard symbols and the instructions are given on the label for proper handling as well.

The interpretation of the hazardous symbols is also important, thus HUL gives proper training to their workers to ensure they understand the potential risks and follow proper procedures for handling and storing chemicals.

Safe packaging is another aspect of the regulation and HUL uses robust, compliant packaging to prevent leaks and ensure safe transportation. By using proper packaging and labelling they safeguard their employees and transport workers and customers.

After following the labelling and packaging regulations, companies like HUL have significantly minimized workplace accidents and enhanced worker safety which has helped in retaining a large mass of workforce. This has ensured the smooth transportation of hazardous materials and boosted its reputation as a responsible industry player.

Restrictions on using hazardous substances: the updated rules have taken inspiration from international regulations such as the European Union. This also includes restrictions on hazardous substances and thereby gradually removing the use of chemicals that impose risk to human health and the environment.
 

Now the companies under the act must substitute the harmful substances with the new substances that are classified as SVHC (Substances of Very High Concern)
 

For instance, Indian chemical companies like ATUL LTD. Have adjusted their portfolio, product formulations and processes to comply with the REACH amendment, improving product safety and sustainability while maintaining EU market access. They are also focusing on developing safer alternatives for restricted chemicals and thereby avoiding costly penalties or market exclusion.

Waste management:

The updated rules have also focused on the waste management aspect by focusing on improving waste management practices across the chemical industry. It also encourages the incorporation of sustainable waste management methods like recycling, reuse, and proper disposal which creates a huge environmental impact.

ISO certifications:

ISO 9001 (Quality Management): ISO 9001 ensures that the companies adhere to high standards of product and process and ensures good quality is delivered to the consumers. The certificates are given to the companies only after they define their quality policy and quality objectives. These objectives must be measurable, achievable and aligned with the organization’s strategic direction. Also, proper documentation of the QMS is essential and maintenance of records of processes, procedures, and policies are required. This ensures that they are up-to-date and accessible.

The key specification of this regulation is to identify the risks and vulnerabilities that could affect the product or service quality. Organizations must plan actions to address the risks and integrate them into their processes. ISO 9001when applied to the chemical industry ensures that the companies maintain consistent quality in the chemical production processes such as:
 

Meanwhile, the chemical manufacturing plant adhering to ISO 9001 could include strict control over raw materials that ensures chemical reactions occur only under specific conditions. It also includes conducting routine quality checks on the final product to ensure that it meets the necessary specifications before the products are dispatched to the consumers.

Case study: TATA Chemicals has achieved ISO 9001 certifications as they have implemented strict quality control mechanisms. The certification highlights the company ensures consistent delivery of high-quality products and services. The company also continuously improve and conducts regular internal and external audits to identify the areas that require enhancement in their processes and ensure efficiency and compliance with the global quality benchmarks.

ISO 14001:

ISO 14001 is an international standard that provides the framework for environmental management systems in varied sectors and covers aspects such as waste management, pollution control, resource efficiency, compliance with environmental laws and regulations, risk management and others in the chemical sector. Therefore, the certification for ISO 14001 covers categories and aspects that help in designing company policies that encourage environmental sustainability and regulatory compliance.

ISO 27001:

ISO 27001 is meant for information security management systems and its implementation in Indian chemical companies helps in ensuring data protection and preventing cyber threats.

Impact on industries and growth opportunities in the future:

The regulations and guidelines related to the safety of health, work environment and environment have a profound impact on varied processes of the chemical industry that include product development, production and monitoring other aspects such as safety, environmental impact and sustainability. Therefore the number of accidents inside the industry and workers protection and surrounding communities have reduced as well.

The introduction of ICIS has created a centralized database for the chemical industries to track down the chemicals, making it easier for the regulators to monitor and thrust compliance. These practices have helped in responding to chemical emergencies efficiently and promptly.

As far as the past decade, the growth in the Indian chemical industry is astounding and the figures camouflage the challenges present in it. The Indian chemical industry has grown about 10-12% annually and the specialty chemicals have grown by 14% annually and segments such as construction chemicals, personal care ingredients and water treatment chemicals have grown by 20% annually as well.

In addition to that the future looks good for all of these sectors. India is comfortably positioned to make use of biomass as their fuel for production processes. Sugarcane biomass is considered the most developed and available in sufficient quantities. Efforts of the private companies, governmental funds and other aspects have provided some breakthroughs.

Take away:

The latest update on the Indian chemical regulations demonstrates its significance in the progress of its growth. These regulations and compliances ensure the safe and sustainable management of chemicals in India. Overall the alignment of regulations with international standards and introduction of stricter requirements and the efforts of the government to enhance worker safety and environmental protection are much appreciated by the market players, consumers and the general public. Even though the chemical industry is facing and may face significant challenges in the future, the new regulations, and strategies are pushing the industry toward long-term benefits in terms of enhanced safety, sustainability and compliance with global standards.