In India, the medical devices manufacturing sector faces lack of a level playing field vis-à-vis competing economies. The sector suffers from a disability of around 12% to 15% on account of various factors.
To address this disability, the department prepared two schemes for medical devices: scheme for promotion of medical device parks and PLI – Production Linked Incentive scheme for promoting domestic manufacturing of medical devices. India’s Union Cabinet approved these two schemes on 20.03.2020.
The total size of the Scheme for promotion of Medical Device Parks is Rs. 400 Crore and tenure of the Scheme is five years (2020-21 to 2024-25).
The scheme will provide grant-in-aid to 4 Medical Device Parks with a maximum limit of Rs. 100 Crore per park or 70% of the project cost of Common Infrastructure Facilities, whichever is less.
In case of hilly states and North East Region, the grant-in-aid would be Rs.100 Crore per park or 90% of the project cost of Common Infrastructure Facilities, whichever is less.
The assistance under the proposed scheme will be admissible for creation of Common Infrastructure Facilities such as Component Testing Centre, Electro-magnetic interference laboratory, Biomaterial / Biocompatibility testing centre, Medical grade low vacuum moulding, Cabinet moulding, injection moulding centers, 2D designing and printing for medical grade products, Sterilization and Toxicity testing centre, Radiation testing centre etc.
The scheme is under implementation. It received a very enthusiastic response from the states. Applications have been received from 16 states.
Production Linked Incentive (PLI) scheme for promoting domestic manufacturing of medical devices has a financial outlay of Rs. 3420 crores. The tenure of the scheme is from 2020-21 to 2027-28. The scheme will provide financial incentive to domestic manufacturers with an objective to boost domestic manufacturing and attract large investments in the Medical Device sector.
The Scheme shall extend an incentive of 5% on incremental sales (over base year) of medical devices manufactured in India and covered under four target segments of the scheme, to eligible domestic manufacturers, for a period of five years.
The scheme is under implementation. A maximum of 28 manufacturers will be selected. 28 applications have been received. The appraisal and selection process of participants is underway and will be completed by end of January 2021.
Scheme for Promotion of Bulk Drug Parks
The Indian pharmaceutical industry is the 3rd largest in the world by volume. India contributes 3.5% of total drugs and medicines exported globally with a ranking of 14 in terms of value. However, despite these achievements, India is significantly dependent on import of basic raw materials, viz. Bulk Drugs that are used to produce the Finished Dosage Formulations. Bulk drugs accounted for 63% of the total pharmaceutical imports in the country during 2018-19.
India imports bulk drugs largely for economic considerations. It is observed that in some specific APIs the import dependence is 80 to 100%. The situation is more alarming in case of Key Starting Materials (KSMs)/ Drug Intermediates, which are the building blocks for manufacturing of APIs. This is a matter of serious concern since any disruption in the supply could jeopardize the Indian pharma sector and had adverse impact on the drug security in India.
The total size of the Scheme for promotion of Bulk Drug Parks is Rs. 3000 Crore and tenure of the Scheme is five years (2020-21 to 2024-25). The scheme will provide grant-in-aid to 3 Bulk Drug Parks with a maximum limit of Rs.1000 Crore per park or 70% of the project cost of Common Infrastructure Facilities, whichever is less. In case of hilly states and North East Region, the grant-in-aid would be Rs.1000 Crore per park or 90% of the project cost of Common Infrastructure Facilities, whichever is less.
Initiative taken for new PLI scheme for pharmaceuticals:
New PLI scheme for pharmaceuticals with an outlay of Rs 15000 crore has received in-principle approval by the Union Cabinet on 13.11.2020. This is one of the many PLI schemes approved by the Union Cabinet on a proposal by the NITI Aayog. The scheme is under preparation and is planned to be launchedin the current financial year.
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