Make in India boost: Government planning to incentivise companies to produce bulk drugs

As part of a plan to reduce dependence on China and boost the 'Make in India' programme, the government is working on a package to incentivise both state-run and private companies to produce ingredients that are used in making medicines.

Thus, the government is mulling revival of two sick public sector units involved in production of active pharmaceutical ingredients (APIs) or bulk drugs, besides inviting private companies to set up manufacturing units.


The package was considered at a meeting called by the Prime Minister's Office on November 5 to review the status of imports of bulk drugs and chalk out a strategy to make them in India, officials said. India imports about 85% of its bulk drugs from China.

There was a discussion on reviving two sick public sector units and making the sector attractive for private companies to participate in manufacturing," an official told Economic Times, who did not wish to be identified.

Another official said that the government also wants to use a cluster-based approach for the sector under which fiscal benefits can be extended to create infrastructure with common facilities.
Most of these suggestions are based on the recommendations by a committee headed by former health secretary VM Katoch which proposed in September the establishment of mega parks for APIs, revival of public sector units to make select and critical drugs such as penicillin and paracetamol, and financial incentives to promote the local bulk drugs sector. The committee said in its report that three clusters will help eliminate India's dependence on APIs. India imported APIs worth $3.9 billion in 2014-15, of which China accounted for $3.3 billion.

In 2004-05, the total API imports were worth $800 million.

Image credit: Indiatimes