Compliance
The 500-metre rule: when two plots become one installation
Most plants that handle hazardous chemicals check their inventory against the threshold in the rules, find they are comfortably below it, and move on. The calculation is often wrong, not because the number is wrong but because the site boundary is. India's hazardous-chemical rules add up stock across every installation the same occupier runs within 500 metres.
The rules in question
The Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989, made under the Environment (Protection) Act, set threshold quantities for named chemicals. Cross a threshold and a much heavier regime applies.
Two schedules carry the thresholds. Schedule 3 lists chemicals for industrial activity; Schedule 2 covers isolated storage. A few examples:
| Chemical | Schedule 3, Part I | Schedule 2, isolated storage |
|---|---|---|
| Diphenyl methane di-isocyanate (MDI) | 20 tonnes | 20 / 200 tonnes |
| Toluene di-isocyanate (TDI) | 10 tonnes | 10 / 100 tonnes |
| Very highly flammable liquids | — | 7,000 tonnes |
| Highly flammable liquids | — | 10,000 tonnes |
The clause that changes the arithmetic
The thresholds, the rules say, "apply in any case to each group of installations belonging to the same occupier where the distance between the installations is less than 500 metres." There is further aggregation for pipelines and adjacent sites.
In plain terms: two plots on the same industrial road, run by the same occupier, are one installation for this purpose. A plant holding 8 tonnes of TDI on one plot and 5 tonnes on another, 300 metres apart, holds 13 tonnes. That is above the 10-tonne threshold, though neither plot is on its own.
Industrial clusters make this common. A business that grew by taking the next plot, then the one across the road, can drift over a threshold without ever buying more on any single site.
What crossing the threshold triggers
This is not a form. It is a standing set of obligations:
- Site notification under Rule 7, with the particulars in Schedule 7, at least three months before the activity begins.
- A safety report under Rule 10, containing the Schedule 8 information, at least ninety days before the activity begins.
- An annual independent safety audit under Rule 10(4), by an expert "not associated with such industrial activities", with the report and the occupier's comments sent to the authority within thirty days.
- A refreshed safety report every three years, and before any modification that materially affects it.
- A mock drill of the on-site emergency plan every six months under Rule 13(4), with the report made immediately available to the authority.
Schedule 4 names the kinds of operations caught, including esterification, polymerisation, distillation, extraction and mixing. The regime bites on process, not only on how much sits in tanks.
Safety data sheets are their own trap
Rule 17 and Schedule 9 require a safety data sheet for every hazardous chemical held, in a nine-section Indian format. India has not adopted the UN's globally harmonised system. A sixteen-section sheet from an overseas supplier does not, by itself, show compliance with Schedule 9. Rule 17(4) also requires each container to carry the contents, the manufacturer or importer, and physical, chemical and toxicological data on its label.
How to check your own position
- List every installation the legal occupier runs, with its address and the distance to each of the others.
- Group any within 500 metres of each other, and include connecting pipelines.
- Add up the maximum inventory of each listed chemical across each group, using the peak held, not the average.
- Compare each group's total against Schedules 2 and 3.
- If a group crosses a threshold, check each obligation above: the notification and its date, the current safety report, the last independent audit and who did it, and the last two mock-drill reports.
- Check your safety data sheets against Schedule 9, chemical by chemical.
Why this sits with operations
The aggregation rule turns a compliance question into a question about how the business is structured: which entity occupies which plot, what each plot holds, and how stock moves between them. Those are operating facts. In a growing group they are often known to different people and written down nowhere in one place.
The answer is an entity, site and licence map that one person owns, kept current as the business changes. If you would like an outside read on where your operating model is under strain, the free eight-minute Operations Health Check is a good place to start.
Last reviewed 25 October 2026, from the primary text of the MSIHC Rules, 1989, Rules 2, 7, 10, 11, 13 and 17 and Schedules 2, 3, 4, 7, 8 and 9. This is an operator's summary, not legal advice; confirm your position with the authority or counsel.