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Rs 996-cr package for SMEs in bulk drugs

Last Updated 24 September 2017, 20:06 IST

With the pharmaceutical sector struggling to keep pace with international standards, the central government is readying a Rs 996-crore plan to boost small and medium-sized enterprises (SME) units focusing on bulk drug and medical device —  two areas where India is heavily import-dependent.

As per the three-year plan, reviewed by DH, the lion’s share (Rs 600 crore) would be allocated for the bulk drug industry, whereas the sunrise medical device sector would receive Rs 150 crore.

A budget of Rs 180 crore has been proposed for pharmaceutical technology upgrade assistance scheme and Rs 60 crore would be set aside for a separate scheme to assist the industry.

The remaining Rs 6 crore will be spent on pharmaceutical promotion development scheme.

The department of expenditure under the Union finance ministry in August gave in-principle approval to the scheme, put forward by the department of pharmaceuticals, which is finalising the nitty-gritty of the scheme, before it goes to the Union Cabinet for final approval.

The proposal seeks to create dedicated industrial parks for manufacturing bulk drug, as suggested by an expert panel, headed by former ICMR chief V M Katoch. Bulk drugs are raw material required to manufacture the formulation sold in chemist shops.

Moreover, the programme aims to improve the small and medium industry in the pharmaceutical sector as nearly 10,000 (out of 10,500 units in total) drug manufacturing units belong to the SME category, which are not in a financial position to improve their processes.

A big chunk of the money would be utilised to create common facilities both in the bulk drug and medical device sector.

For the bulk drug sector, the common facility would be an effluent treatment plant that can cut down the manufacturing cost by 20%-25%.

For medical device, the common facility could be testing laboratories and moulding centres that all manufacturers can use.

As export constitutes around 50% of the total industrial turnover, Indian drugs are being sold in highly regulated markets like USA, Russia, Germany, Austria and the UK with USA alone accounting for almost 25% of the export.

But with international customers demanding more stringent environment compliance standards, the SME sector faces a big challenge due to its financial limitations and antiquated standards. The proposed scheme is meant to address these issues.

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(Published 24 September 2017, 20:06 IST)

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