March 21, 2020
The scheme will direct US$910 million towards the media devices manufacturing sector
The Indian medical devices sector is forecasted to reach close to US$11.6 billion by 2022
4 medical device parks and 3 bulk drug parks are to be set up within the next five years
US$926 million will support domestic manufacturing of critical drug intermediates and APIs
The Union Cabinet, chaired by Prime Minister Shri Narendra Modi, recently approved schemes for the promotion of domestic manufacturing within the pharmaceutical sector, valued at over US$1.8 billion. The schemes include the combined expenditure of US$910 million towards the manufacturing of medical devices and providing common infrastructure facilities in four medical device parks and three bulk drug parks within the next five years, according to an official Cabinet release.
The additional US$926 million will go towards a Production Linked Incentive (PLI) Scheme promoting the domestic manufacturing of critical drug intermediates and active pharmaceutical ingredients (APIs) in India by 2028.
Medical Device Parks
Within the healthcare industry, the medical device sector showcases a high potential for growth with it is forecasted to reach close to US$11.6 billion in valuation by 2022. India is currently dependent on imports to meet domestic demand for medical devices but this scheme will help in attracting large investments towards the sector, enabling its self-sufficiency.
In partnership with select States, the scheme will utilise a State Implementing Agency (SIA) to financially support basic infrastructure facilities in 4 medical device parks, significantly reducing manufacturing costs. In addition, the Department of Pharmaceuticals will select a Project Management Agency (PMA) to assist 25-30 domestic medical device manufacturers, leading to increased production and the generation of over 33,000 jobs.
Bulk Drug Parks
The other scheme focuses on partnering with states to develop three bulk drug parks, equipped with the necessary facilities to reduce India’s domestic manufacturing costs and dependency on imports. The Cabinet has approved an investment of over US$1.3 billion towards setting up the three bulk drug parks with the help of SIAs and incentivising the manufacture of 53 critical drug intermediates and APIs through a PMA.
The schemes will help in boosting domestic manufacturing and attracting further investment into the sector. By reducing India’s dependence on imports, it will lead to incremental sales of US$6.2 billion and promote significant employment generation over the next eight years.
