Union Budget 2023: Medical Technology Association of India (MTaI) on Wednesday said that the industry expects the government to address the pending list of asks in the upcoming Union Budget 2023.
During the previous year, the MedTech industry saw several new reforms which aim to take India’s regulatory mechanism on par with the best global systems available.
“Schemes like PLI introduced by Department of pharmaceuticals as well as creation of medical parks across the country underscored the intent of the Modi government to take the country’s Medical Device sector to the next level. Several efforts have also been undertaken to reduce compliance burdens which will go a long way in reassuring investors and attract FDI in the sector as already evident from the first three quarters of 2022,” the MedTech body said in a statement.
“As per government data, nearly 80% of medical devices are imported into India to meet the rising demand for quality healthcare. Meanwhile, the custom duties and taxes levied on medical devices in India are one of the highest in the world and highest among the neighbouring countries which directly impacts patient affordability and is contradictory to what the government is trying to achieve. As the preparation for the Union Budget 2023 gets underway, we expect a correction on the same,” Pavan Choudary, MTaI Chairman and Director General, said in a statement.
Choudhary also emphasised that the MedTech industry expected more from the previous Union budget than it yielded.
“The sector requires more focus in government outlays to ensure organic growth of the industry and realize its true potential. One way to achieve this is by increasing the public health spending to meet the current gaps in healthcare demand and supply. A separate budget should also be allocated for the promotion and marketing of the medical device sector globally,” he added.
According to the MedTech body, there is a need to reduce high customs duties to 2.5% on medical devices. For products where the ability to import-substitute is still some time away; the high customs duty should be reduced.
The association claims that the high customs duty has adversely impacted the costs for medical devices in India which contradicts the government’s efforts to provide low-cost healthcare available to masses through various healthcare schemes.
The body also urged that the 5 percent healthcess ad valorem imposed on imported medical devices has further compounded the burden on the industry.
Moreover, there is a need to allocate a separate budget for the promotion of the Medical Device industry.
“A separate budget of up to $5 Million needs to be allocated for the promotion, advertising, and marketing of the Indian medical device industry globally. This will help strengthen ‘brand India’ and get greater acceptability of India-made medical devices in overseas markets which will further the government’s vision of ‘Make in India for the world’. It will also help in the promotion of India as the destination of manufacturing and R&D in MedTech,” the body stated on Wednesday.
The MedTech body also demanded an increase in public health spending to meet the healthcare demand-supply gap, incentivizing Skilling initiatives to bridge the kill gap and the exemption of free medical device samples from TDS. It also demanded an increase in tax exemption and benefits for patients.
“As the prevalence of NCDs like heart diseases, stroke, diabetes and respiratory diseases is continually rising and is estimated to comprise 75% of India’s disease burden by 2050, therefore to enable timely treatment, preventive health checkups should be encouraged by increasing tax exemption limit from Rs 5000 to Rs 15000. Additionally, the deduction limit towards payment of medical insurance premiums under section 80D should be increased from Rs. 25,000 to Rs. 50,000,” the body demanded.
