German chemical giant BASF SE, Abu Dhabi National Oil Company, Adani Group and Borealis AG have jointly decided to put on hold their plan to set up a chemical complex in India, due to the Covid pandemic.
Last year, the four entities had signed an agreement to set up a chemical complex at Mundra in Gujarat at an investment of $4 billion.
The project comprised a large propane dehydrogenation plant, polypropylene production and an acrylics value chain complex with access to port and renewable energy supply. The joint venture company had completed a feasibility study and production was intended to commence in 2024.
“The global economic uncertainties caused by the pandemic have led the partners to review the timing for undertaking this investment. Despite all attempts to optimise the scope and the configuration, the project has been put on hold,” the companies said in a joint statement on Thursday.
“The partners remain convinced about the strong fundamentals represented by the Indian market and agreed to periodically explore market conditions and discuss any opportunity that may arise over time,” they added.
The partners were also evaluating co-investment in a wind and solar park with the plans at an advanced stage of development. This would have been the world’s first CO-neutral petrochemical site to be fully powered by renewable energy.