With real estate recovering from its recessionary phase and with the government stoically pursuing its infrastructure agenda, the prospects for the construction chemicals industry are certainly bright. However, more than acceleration of the user industries, what the construction chemical industry needs is deeper market penetration and higher acceptance. Compared to global standards, where the construction industry is more mature, India seriously lags behind in terms of usage of construction chemicals.

Based on recent figures, construction as an activity accounts for 8 per cent of India's GDP. Despite this fairly large share, the size of the construction chemicals industry is very low-estimated at around 1,800 crore. On the brighter side though, analysts are of the opinion that the industry would touch around 4,000 crore by 2013, implying a growth of at least 15 per cent annually.

The construction chemicals sector is amongst the niche segments in the speciality chemicals industry. Construction chemicals are products used in structures to increase their life and also to offer protection against environmental damage. The segment also includes products that are meant to minimise the use of water and cement in the construction process. For a country like India that is largely tropical, damage to structures from sun's heat and light is an important consideration. The market for construction chemicals in India is, indeed, huge, but its exploitation will happen only in degrees.

Reliable estimates suggest that an appalling 80 per cent of building contractors are not fully aware or inclined to use construction chemicals during the construction process. This gives an idea of just how much of the market remains unexploited. It is also disturbing to note that contractors that use construction chemicals may not do so scientifically.

Further, contractors, particularly small and medium real estate developers, may not deploy construction chemicals fearing an increase in project costs. In summary, the construction chemicals industry's growth is today stifled by an attitudinal problem.

The construction chemicals industry in India is informal with a myriad of small players in the organised sector overwhelming the market structure. There are small companies that specialise in certain types of chemicals like waterproofing, concrete admixtures and coatings.

With the recent opening of 100 per cent FDI in this sector, multinationals are beginning to enter this growing market. This is welcome news as the Indian construction industry gets exposure to world-class products and construction techniques.

In a typical civil construction project, the cost of construction chemicals is only around 2 per cent of the total construction cost of a project. Despite this, the use of such chemicals is still nowhere near the true potential. Experts feel that the size of the Indian construction chemicals industry should technically be in the region of 10,000 crore against a paltry 1,800 crore today. The biggest roadblock, as earlier discussed, is poor consumer awareness. A measly 5 per cent of concrete used in construction in India is treated with construction chemicals, reliable information suggests, a far cry from 80 per cent in developed countries.

The construction chemicals industry has an exciting future but prominent players will have to do much more than churn out quality products. A continual effort in creating market awareness should be high on their agenda.