The Union Cabinet, chaired by Prime Minister Narendra Modi, on 25 July 2025 approved the Bharat Audyogik Vikas Yojana Rasayan (BHAVYA-Rasayan) Scheme, committing ₹3,030 crore to establish three dedicated Chemical Parks across India. The decision, formalised after the Cabinet meeting in New Delhi, marks a significant push to modernise and cluster India's chemical manufacturing sector.

Scheme Structure and Funding

Of the total outlay, ₹3,000 crore is earmarked for developing common infrastructure and basic utilities inside the parks, while the remaining ₹30 crore covers administrative expenditure. The scheme runs for five years, from FY 2026-27 to FY 2030-31, and was first announced in the Union Budget for FY 2026-27.

The Centre will provide a grant of up to ₹1,000 crore per park, subject to a minimum matching contribution of ₹500 crore from the respective State Government. Parks will be selected through a Challenge Route, ensuring competitive allocation among states.

What the Parks Will Look Like

Each Chemical Park must have a minimum contiguous area of 8 sq. km. (at least 2,000 acres) of encumbrance-free land. The parks are designed to offer plug-and-play infrastructure — shared facilities and utilities that chemical manufacturers can tap into without building their own captive systems.

Centralised facilities will include common effluent treatment plants, treatment, storage and disposal facilities, and hazardous waste management infrastructure. According to an official statement, this is expected to improve compliance with environmental regulations and foster eco-friendly industrial growth.

Why It Matters for Indian Industry

India's chemical sector supplies inputs to agriculture, textiles, pharmaceuticals, nutraceuticals, construction, automobiles, and electronics — virtually every major manufacturing vertical. The BHAVYA-Rasayan Scheme is designed to accelerate growth across the entire value chain, from upstream raw materials to downstream finished goods and ancillary industries.

Shared infrastructure is expected to lower logistics costs and improve cost competitiveness, enabling Indian chemical companies to integrate more effectively into global value chains. Officials indicated the scheme aims to drive both higher exports and greater import substitution — a dual objective that aligns with the broader 'Atmanirbhar Bharat' framework.

Employment and Viksit Bharat Goals

The government projects that growth in the chemical sector will have a cascading effect on downstream industries, generating employment and contributing to the Viksit Bharat @ 2047 vision. The scheme is also designed to attract domestic and foreign investment and expand overall production capacity in the sector.

Notably, this initiative follows a broader pattern of the Centre using dedicated park models — similar to the approach taken in electronics and semiconductors — to achieve scale and shared-cost efficiencies. Whether state governments mobilise the required ₹500 crore minimum contribution will be a key determinant of how quickly the three parks take shape.