The Indian chemicals industry is forecast to record value-added growth this year. Specialty chemicals remains a fast growing segment, on the back of favourable oil prices and strong domestic and export demand.
On average, payment in the Indian chemicals sector varies between 60 days and 180 days, depending on the position in the value chain and businesses bargaining power, credit policy, and geographical position.
For example, chemicals manufacturers purchasing raw materials have shorter credit terms.
The level of payment delays and insolvencies is rather low in the chemicals sector, and no major increase in business failures is expected this year.
There are stiff competition and price pressures in a very strictly regulated market environment.
Solutions for mitigating trade risk
Should your debtors fail to meet their payment obligations, Atradius Collections can help by initiating a professional collection process.
We have a local team in India that follow proven principles of negotiations. By keeping in close contact with the debtors, we are able to evaluate genuine cash flow problems and stalling excuses for non-payment. Field visits and face-to-face meetings with the debtors are an integral part of our collection initiatives.
Whilst Atradius Collections maintains a high success rate with third-party collections, if necessary and with your approval, we have the ability to initiate legal action and arrive at a successful conclusion via court.
In India, legal proceedings are generally protracted in nature and can be initiated immediately after the third-party collections fail. There is a need to issue a prior notice before initiating a recovery under section 138 suit. new law of the National Company Law Tribunal (NCLT), helping set winding-up proceedings on a fast track.