India may ease price control regime for medical devices on US request

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Updated: May 08, 2019 5:28 AM

India has also sought to allay US concerns over latest e-commerce policy as well as Draft Personal Data Protection Bill, 2018, suggesting Washington’s observations will be considered “in a fair manner”, the source said.

India, price control, india us trade, medical devices, US, industry news, FDI, foreign direct investment, financial express, financial express epaper, financial express newspaper, financial express todayIndia may ease price control regime for medical devices on US request. (Reuters)

India is favourably considering a US request to loosen its price control regime for medical devices and apply trade margin on coronary stents and knee implants at the first point of sale (price to stockiest), instead of imposing it on the landed prices, as was planned earlier, a source told FE.

New Delhi is weighing a time frame to roll out this proposal, which will be finalised after the new government takes over, said the source. This could be part of New Delhi’s revised offer to Washington under a bilateral trade package that has been under negotiations for months now without success.

India has also sought to allay US concerns over latest e-commerce policy as well as Draft Personal Data Protection Bill, 2018, suggesting Washington’s observations will be considered “in a fair manner”, the source said. US commerce secretary Wilbur Ross, who is currently on a visit to New Delhi, has called for the removal of various trade barriers in India.

The US is learnt to have been peeved at the constant “shifting of goal posts” regarding India’s foreign direct investment (FDI) guidelines in e-commerce. Washington thinks the Indian FDI rules deny a level-playing field to foreign players like Amazon and Walmart (which has acquired Flipkart), another source said.

The data bill provides for restrictions on cross-border transfer of personal data. The US has expressed reservations over the Bill, saying it would harm companies that rely on cross-border data flows to conduct business. The US has asked India to permit cross-borders data flow to companies once they certify to binding international codes of conduct, such as the APEC’s Cross-Border Privacy Rules System.

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The FDI norms for e-commerce, the December 26 guidelines bar online marketplaces with foreign investments from selling products of the companies where they hold stakes or control inventory, and also ban exclusive marketing arrangements. It also said the inventory of a vendor (except food retail) will be “deemed to be controlled by e-commerce marketplace if more than 25% of purchases of such vendor are from the marketplace entity or its group companies”.

An earlier rule stipulated that more than a fourth of an e-tailer’s sales couldn’t come from a single vendor. Since the government effectively doesn’t allow FDI in multi-brand retail, it has sought to squeeze any scope for a back-door entry for this via online marketplaces.

Already, as per reports, Amazon has reiterated its commitment to India and its regulatory policies and Walmart has scotched rumours that it may exit Flipkart in the wake of the new FDI norms. As for the price control on life-saving drugs, India has already implemented the trade margin rationalisation model and rolled it out for specified anti-cancer drugs in February 2019.

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