For fermentation-based raw material production, we will give incentive at 20% for the first four years, 15% for the fifth year and 5% for the sixth year on incremental manufacturing of raw materials.
Despite being the world’s third-largest by volume, the Indian pharmaceutical industry depends a lot on imports to meet its raw material needs. The recent Cabinet approval for promotion of bulk drug parks and domestic manufacturing of key starting materials (KSMs), drug intermediates and active pharmaceutical ingredients (APIs) will help a lot, chemical & fertilisers and shipping minister Mansukh L Mandaviya tells Surya Sarathi Ray in an interview. Excerpts:
What is the current status of API production in our country?
At present, India is dependent on imports of basic raw materials like KSMs, drug intermediates and APIs to produce medicines in the country. We import about 60-70% of the total requirement of APIs, largely for economic considerations. There are 53 APIs where import dependence is very high. We are importing APIs amounting to of Rs 42,000 crore while exporting APIs worth Rs 36,000 crore.
What steps the government has taken considering the shortage of APIs production?
After the Narendra Modi 2.0 government assumed office, a task force was constituted in the Department of Pharmaceuticals, headed by me, with an objective of removing the imbalance in import and export of APIs, and also achieving drugs security in the country through domestic production of APIs and drugs. The task force has held wider and detailed consultations with various industrial associations. The reasons for the country’s inability to domestically produce 53 critical APIs have been identified and a strategy for domestic production has been chalked out.
What about domestic production of medical devices?
India imports around 85% of medical devices. Though India produces medical devices indigenously, it depends on import of high-end ones in four categories – radiotherapy, radiology, anasthetic and implants.
Where does the government stand now in its drug security commitment?
Our government is committed to ensure drug security. We are focused on this. My ministry has chalked out an umbrella scheme of Rs 13,760 crore with four schemes on bulk drug manufacturing and medical devices manufacturing in the country to achieve national security of drugs.
Will the latest Cabinet decisions ensure self-sufficiency in API production?
The Cabinet has recently approved all the four schemes. The bulk drug scheme will help establish three bulk drug parks with a minimum area of 1,000 acre where the Centre will provide grant-in-aid to the tune of Rs 1,000 crore for creating common facilities like solvent recovery plant, power and steel units, distillation plants, common effluent treatment plants, etc.
The production-linked incentive scheme for bulk drug parks aims at giving incentive on an incremental basis. We have identified 53 critical KSMs/APIs and drug intermediaries, out of which 26 are fermentation-based and 27 are chemical-based. For fermentation-based raw material production, we will give incentive at 20% for the first four years, 15% for the fifth year and 5% for the sixth year on incremental manufacturing of raw materials. In case of chemical-based raw materials, we will give 10% incentive during the six-year period of the scheme.
In short, what is India going to achieve through these recent steps?
The expected outcomes would be – a) drug security through self-sufficiency in manufacturing of 53 critical bulk drugs, b) ensure the availability of various essential drugs listed under NLEM at affordable prices and c) cumulative reduction in imports by around Rs 46,400 crore in next eight years.
Moreover, at the end of five years, import substitution per annum will be Rs 8,500 crore, against current imports of Rs 19,000 crore of specified drugs. The schemes would also create 7,000 direct employment and 14,000 indirect jobs.