New Delhi: As the war in West Asia disrupts global trade flows, the Indian government has launched a sweeping audit of critical supply chains to map vulnerabilities and reduce import dependence, according to three government officials and documents reviewed by Mint.
The exercise, which covers sectors such as pharmaceuticals, medical devices, fertilizers and textiles, comes amid concerns that supply shocks could derail India’s growth trajectory.
“The plan is to identify structural vulnerabilities in India’s industrial landscape, with a focus on supply chain dependencies and manufacturing capabilities,” the first official cited above said on condition of anonymity.
A detailed government questionnaire circulated by the commerce ministry’s supply chain division—reviewed by Mint—to key stakeholders has asked firms to disclose granular data on import dependence, covering specific items, source countries, reliance on foreign suppliers, and whether key inputs are “irreplaceable or non-substitutable”.
The questionnaire also seeks production metrics such as HSN-coded output, domestic and export turnover, and constraints to scale, including technology licensing barriers and infrastructure gaps. The government has set a late-March deadline for consolidated responses.
The Centre is also assessing logistics risks—ranging from lead-time increases and port congestion to the share of freight in landed costs—while evaluating industry’s technological readiness, including automation, Industry 4.0 adoption (AI, robotics, ML, IoT), and regulatory reforms needed to boost competitiveness.
Queries emailed to the spokespersons of the ministries of commerce, petroleum and natural gas, petrochemicals, pharmaceuticals, Indian Oil Corp., Hindustan Petroleum Corp. Ltd, and GAIL (India) Ltd on Monday remained unanswered till press time.
Ringfencing fertilizers
For , the assessment covers critical inputs for urea, diammonium phosphate (DAP) and potash, along with key agrochemicals and intermediates essential for sustaining farm output.
India is the world’s second-largest fertilizer consumer and the largest importer of finished fertilizers such as DAP (60%), and urea and NPK fertilizers (15%). The country also imports several key raw materials and intermediates such as rock phosphate, phosphoric acid and potash due to limited domestic availability.
Fixing pharma
On the pharma front, the government’s questionnaire focuses on key starting materials (KSMs), drug intermediates, and active pharmaceutical ingredients (APIs) that are currently threatened by . Notably, APIs, bulk drugs and advanced intermediates account for 63% of India’s pharma imports ($4.35 billion in FY25).
A second official, who also requested anonymity, said “These inputs will help in identifying critical supply chain dependencies and policy measures required to strengthen domestic manufacturing in the pharmaceutical and medical devices sector.”
Industry participants said prices of polypropylene—a petrochemical derivative that is a key input for syringes and IV bags—have surged up to 50% after refinery-grade propylene and benzene were diverted to LPG production. The shift has halted domestic isopropyl alcohol (IPA) output, a critical pharma input, and disrupted paracetamol manufacturing due to shortages and price spikes in key feedstocks such as PNCB (para nitro chloro benzene) and acetic anhydride.
Jaijit Bhattacharya, president of think tank Centre for Domestic Economy Policy Research (CDEP), said, “These petrochemicals are critical ‘upstream’ components for at least 14 therapeutic categories of medicines listed in the National List of Essential Medicines (NLEM) 2022…The diversion is disproportionate to the benefits gained for the energy sector.”
“Prices have shot up—for some solvents and certain materials, prices have already gone up by 40-50%,” said an executive at the Pharmaceuticals Export Promotion Council of India (Pharmexcil), an organization under the commerce ministry, adding that while the industry is currently operating on existing inventory, API manufacturers are under increasing stress because solvent manufacturers are already struggling with supply quotas.
“My input cost has gone up and, accordingly, my pricing is also going up…All my suppliers have given me force majeure clauses,” said Vijay Mamania, vice-president, marketing of Aarti Industries Ltd, which accounts for 70% of domestic PNCB production.
Mamania added that even Aarti Industries has activated force majeure clauses for some of its customers. “For the first time in my 30-year career, I have given force majeure clause to some of my customers, which I have never done. I’ve never done this (even) in covid times.”
Viranchi Shah, national spokesperson for Indian Drugs Manufacturers Association, that represents 1,200 manufacturers, said the association had made a representation to the government to ensure the gas-related supply chain remains intact, and requested the government to support the pharma industry.
“As of now, there is no panic,” Shah said. “Everything being done is preemptive to ensure no future impact on the medicine supply chain. The situation is changing every minute, but these are all precautionary measures.”
A spokesperson for state run Bharat Petroleum Corp. Ltd (BPCL), which has polypropylene manufacturing plans at Kochi and Bina, in an emailed response said, “We remain in active engagement with the Department of Petrochemicals on various industry-related matters, including the aspects of supply chain.”
Protecting textiles
Meanwhile, key inputs for India’s $179 billion —especially synthetics—are also largely petrochemical-derived.
These include terephthalic acid (PTA) and monoethylene glycol (MEG), which are used to produce fibres such as polyester, nylon and acrylic. The sector also depends on a range of petrochemical-based dyes, chemicals and finishing agents, making it sensitive to fluctuations in crude oil prices and supply disruptions in regions such as West Asia.
“The textiles ministry, in coordination with other line ministries, is working to ensure the steady supply of key inputs such as petrochemical-based raw materials, including PTA, MEG, synthetic fibres and dyes, while also monitoring logistics and freight disruptions,” said the third government official cited above, who also did not want to be named.
India’s petrochemical market is over $220 billion.
“Prices of petrochemicals have surged and availability has also tightened. This will make fibres costlier, which could create challenges for the textiles sector,” said Bhadresh Dodhia, former SRTEPC chairman and director at Dodhia Group, adding that the situation remains critical. He said the commerce ministry is working with export promotion councils to ensure steady supply of key intermediates.