India Methanol Market [2028]: Analysis & Forecast

India methanol market is anticipated to grow significantly rate in the projected period of 2028. The government’s efforts to promote methanol as a transportation fuel include setting up methanol fuel stations and retrofitting existing vehicles to run on methanol. Additionally, research and development are underway to manufacture methanol-powered vehicles and engines specifically designed to optimize methanol combustion efficiency.

Apart from transportation, methanol holds immense potential for industrial and power generation applications. It can be used as a feedstock to produce chemicals, plastics, and pharmaceuticals, thereby reducing reliance on imported raw materials. Methanol can also be employed in fuel cells to generate electricity, offering an alternative to traditional fossil fuel-based power generation.

As per the NITI Aayog, the methanol economy will also create close to five million jobs through methanol production, application, and distribution services. Additionally, USD 724.63 crore can be saved annually by blending 20% DME (di-methyl ether, a derivative of methanol) in LPG. India’s methanol production has witnessed a steady increase in recent years. Traditionally, methanol has been primarily imported to meet domestic demand. However, recognizing the need for self-sufficiency and reducing dependency on imports, India has embarked on an ambitious journey to boost its methanol production. Several government initiatives and policies have been implemented to encourage domestic methanol production and attract investment in the sector.

India’s growing population and expanding economy have resulted in increased energy demand, making it imperative to explore alternative energy sources. Methanol has emerged as a promising solution due to its numerous advantages. It can be used as a fuel in vehicles, an alternative to LPG for cooking, a source of power generation, and as a feedstock in various industries.

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Its clean-burning properties and lower carbon emissions compared to conventional fuels make it an attractive option for achieving sustainability goals. The chemical industry is a significant consumer of methanol, utilizing it as a building block for various products such as plastics, paints, and solvents. India’s growing chemical industry presents a vast opportunity for methanol utilization. By promoting methanol as a substitute for traditional feedstocks, the country can reduce its reliance on fossil fuels and move towards a more sustainable chemical manufacturing sector.

This will help the consumer save between USD 0.6-1.21 per cylinder. According to the Ministry of Road Transport & Highways, India is currently the sixth-largest consumer of oil in the world, consuming about 2900 billion liters of petrol and nine thousand billion liters of diesel annually. By 2030, consumption is expected to quadruple, making India the third-largest user. However, pollution will be reduced by more than 80% if, methanol is used in place of diesel and by 33% if methanol 15 (M15) is used in place of petrol.

Growing Use of Methanol in the Transportation Sector

• The Indian transportation industry is one of the main target industries for the use of methanol. Methanol-blend fuels, including M15 (15 percent methanol and 85 percent petrol), have been evaluated and successfully adopted in several Indian towns. Also, to improve air quality and public health, using methanol as a transportation fuel can lower greenhouse gas emissions and air pollution. In addition, according to the Government of India’s Department of Road Transport and Highways, with minimal alterations to existing vehicles and fuel distribution systems, approximately 15 percent of all vehicles can be transformed into DME. Methanol can be blended with gasoline or used as a standalone fuel in several types of vehicles, including cars, buses, trucks, and marine vessels. Its compatibility with existing engine technologies and fuel infrastructure makes it a viable option for a smooth transition to cleaner transportation. Besides that, production of methanol is economically feasible, and its affordability compared to other alternative fuels makes it an attractive option for large-scale adoption. It can be produced from various feedstocks, including natural gas, coal, biomass, and even carbon dioxide, providing flexibility in sourcing and production.

Rising Demand from the Chemical Industry is Driving the Demand of Methanol

• To lessen its environmental impact, the chemical sector is increasingly capitalizing on alternate feedstocks and procedures. Methanol is transforming the chemical sector owing to its adaptable qualities and expanding accessibility, providing a route to more environmentally friendly manufacturing techniques. The production of plastics and polymers is one of the largest sectors within the chemical industry, and it has traditionally relied heavily on fossil fuel-based feedstocks. Methanol presents a compelling alternative to produce key building blocks, such as olefins and formaldehyde. By using methanol as a feedstock, the industry can reduce its carbon footprint, decrease reliance on crude oil, and promote a circular economy by utilizing biomass-derived methanol or recycling carbon dioxide emissions. Moreover, Methanol holds significant promise as a feedstock to produce biofuels and biochemicals. Through advanced biotechnology and catalytic processes, methanol can be converted into valuable fuels, such as biodiesel and bioethanol. Additionally, methanol can be utilized as a building block for the synthesis of bio-based chemicals, including organic acids, esters, and solvents. This not only reduces dependence on fossil fuels but also promotes the utilization of renewable resources and mitigates climate change impacts.

Policy and Regulatory Landscape

• In 2018, the Indian government launched the National Policy on Methanol. This policy serves as a roadmap for the adoption and implementation of methanol-based technologies across various sectors. The policy focuses on promoting methanol production, R&D, infrastructure development, and creating a favorable ecosystem for the methanol economy.
• The government has initiated methanol blending programs in transportation fuels. Methanol-blended gasoline, such as M15 (15% methanol and 85% gasoline), has been successfully evaluated and introduced in several Indian cities. Methanol blending helps reduce emissions and improve air quality by replacing a portion of conventional fuels with cleaner-burning methanol.

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Recent Development’s

• Assam Petrochemicals introduced Asia’s first canister-based methanol cooking fuel program on October 5th, 2018. The goal of this effort is to aim of lowering crude oil imports and working to provide a healthy, affordable, and pollution-free cooking option. Methanol stoves can save homeowners at least 20% on energy costs. The methanol cooking program was expanded to one million homes in the States of Uttar Pradesh, Maharashtra, Gujarat, Telangana, Andhra Pradesh, Goa, Karnataka, Jharkhand, and Manipur following the success of the pilot plant.
• The construction of five high ash coal-based methanol plants, five DME plants, and a 20 MMT/year natural gas-based methanol manufacturing plant in a joint venture with Israel has been planned. In addition, For the Inland Waterways Authority of India, three boats and seven cargo ships are being built by Cochin Shipyard Limited to run on methanol as a marine fuel.
• Moreover, Thermax Ltd has created a 5 KW methanol-based reformer on a Direct Methanol Fuel Cell (DMFC). With the effectiveness of replacing DG sets in mobile towers, this module is currently being evaluated. Kirloskar Oil Engines Ltd. has converted a 5 KW generator set to run entirely on methanol for direct electricity generation. Along with Israeli company Dor Chemicals, Kirloskar is aiming to convert generator sets with a capacity of 150–300 KVA/KW.
• Furthermore, Under R&D, BHEL (Hyderabad and Trichy), Thermax, and IIT Delhi are developing indigenous technology to build coal-to-methanol plants in the country. While BHEL Hyderabad and Trichy are working on 1 TPD and 40 TPD demonstration plants, respectively, Thermax and IIT Delhi are developing a TPD demonstration plant.
• In May 2022, Indian Oil Corp (IOC) rolled out M15 petrol a 15 percent blend of methanol with petrol on a pilot basis in Assam’s Tinsukia district. The company has decided on Tinsukia for the pilot rollout because Assam Petrochemical Ltd. produces methanol near the Digboi plant, making it readily available.

Market Segmentation

India methanol market is segmented based on end-use, distribution channel, and region. Based on end-use, the India methanol market is segmented into formaldehyde, MTO/MTP, MTBE, acetic acid, gasoline blending, and others. Based on the distribution channel, the market is divided into direct sales and indirect sales. Based on region, the market is bifurcated into north, south, west, and east.

Company Profiles

1. Gujarat Narmada Valley Fertilizers and Chemicals Limited
2. Deepak Fertilizers and Petrochemical Corporation
3. Rashtriya Chemicals and Fertilizers
4. Assam Petrochemicals Limited
5. Bharat Heavy Electricals Limited is one of the key players in India methanol market.

Report Scope:

In this report, India methanol market has been segmented into the following categories, in addition to the industry trends, which have been detailed below:

• India Methanol Market, By End-Use:
  • Formaldehyde
  • MTO/MTP
  • MTBE
  • Acetic Acid
  • Gasoline Blending
  • Others
• India Methanol Market, By Distribution Channel:
  • Direct Sales
  • Indirect Sales
• India Methanol Market, By Region:
  • North
  • South
  • West
  • East

Competitive landscape

Company Profiles: Detailed analysis of the major companies in India methanol market.

Available Customizations:

With the given market data, TechSci Research offers customizations according to a company’s specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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Table of Content-India Methanol Market 

1. Product Overview
2. Research Methodology
3. Executive Summary
4. Impact of COVID-19 on India Methanol Market
5. Voice of Customer
6. India Methanol Market Outlook

6.1.  Market Size & Forecast

6.1.1. By Value & Volume

6.2.  Market Share & Forecast

6.2.1. By End Use (Formaldehyde, MTO/MTP, MTBE, Acetic Acid, Gasoline Blending, Others)

6.2.2. By Distribution Channel (Direct Sales, Indirect Sales)

6.2.3. By Region

6.2.4. By Company (2022)

6.3.  Market Map

7. North India Methanol Market Outlook

7.1.  Market Size & Forecast

7.1.1. By Value & Volume

7.2.  Market Share & Forecast

7.2.1. By End Use

7.2.2. By Distribution Channel

8. South India Methanol Market Outlook

8.1.  Market Size & Forecast

8.1.1. By Value & Volume

8.2.  Market Share & Forecast

8.2.1. By End Use

8.2.2. By Distribution Channel

9. West India Methanol Market Outlook

9.1.  Market Size & Forecast

9.1.1. By Value & Volume

9.2.  Market Share & Forecast

9.2.1. By End Use

9.2.2. By Distribution Channel

10. East India Methanol Market Outlook

10.1.              Market Size & Forecast

10.1.1.    By Value & Volume

10.2.              Market Share & Forecast

10.2.1.   By End Use

10.2.2.   By Distribution Channel

11. Market Dynamics

11.1.              Drivers

11.2.              Challenges