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Why India is Emerging as a Global Hub for Pharmaceutical Drug Manufacturers

India CSR by India CSR
September 30, 2025
in Health
Reading Time: 4 mins read
Pharmaceutical Drug Manufacturers

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India is now one of the top locations for pharmaceutical drug manufacturers, having gradually carved out a place for itself in the global pharmaceutical scene.

By enacting laws and implementing numerous programs to support local pharmaceutical businesses and the market, including its exports of medical supplies, India is demonstrating significant momentum in its commitment to achieving its goal of becoming a “pharmacy of the world.”

The pharmaceutical industry is a vital component of India’s economic ecosystem, with significant global importance. India was the third largest producer of pharmaceuticals and medicines by volume in 2023, and contributed 20% of all the generic drugs exported worldwide. Currently, experts value the industry at US$50 billion, and the country is looking to grow it to US$450 billion by 2047.

India ranks third globally in terms of volume and fourteenth in terms of value of pharmaceutical items produced, according to the Economic Survey 2022–2023.

The Pharma Industry’s Historical Background in India

India’s journey to become a global leader in pharmaceutical drug manufacturers is both remarkable and inspiring. Strategic planning and many significant changes to economic and policy environments peppered its journey.

The seeds were sown in the mid-20th century, after the Indian government realized that it was important to start producing essential medicines nationally. Before independence, large Western pharmaceutical companies met India’s pharmaceutical requirements exclusively through imports, charging consumers exorbitant prices.

The passage of the Indian Patent Act of 1970, which recognised process patents and not composition patents on pharmaceuticals, constituted a watershed moment. This change to the law enabled Indian companies to manufacture medications using innovative processes without infringing on the patents of foreign companies.

As a result, local companies began to reverse-engineer branded medicines, leading to a sudden and significant increase in the availability of generic drugs and lower prices.

Factors Influencing Pharmaceutical Success in India

To understand the reasons behind India’s success in the pharmaceutical industry, it is essential to consider its unique combination of resources, strategies, and experience.

  • India has established itself as one of the world’s largest pharmaceutical manufacturers by offering products at a low cost. Low production costs arise from state-of-the-art facilities that facilitate maximum manufacturing efficiency, a rich source of raw materials, and trained professionals at low cost.
  • Indian companies have been routinely investing to meet the highest standards set by international regulations from European Medicines Agency (EMA), the U.S. Food and Drug Administration (FDA), and other international authorities.
  • India’s robust academic and scientific infrastructure is another significant factor contributing to its ability to lead in the pharmaceutical sector. The country has a large pool of well-educated workforce and expertise in pharmaceutical science, biotechnology, and chemistry. These individuals will encourage the advancement of medical formulations, development, and innovation in the industry.
  • A favorable regulatory environment has also played a significant role as an enabling factor that the Indian government has created. The regulatory climate has been designed to support both foreign institutional investment and local production, enabling manufacturers to operate efficiently while promoting an environment that fosters global quality standards.
  • India’s leading position in the generic drug market has earned it the title of “pharmacy of the world.” By creating a model for the production of affordable high-quality generics, Indian pharmaceutical companies have provided everyone with access to essential medicines.

Future Developments in Technology and Trends

The landscape of pharmaceutical production in India is poised for a radical transformation as emerging technologies and innovative methodologies revolutionize various aspects of the industry.

The development, manufacturing, and delivery of pharmaceuticals are likely to undergo a dramatic transformation as a result of the adoption of innovations, such as blockchain technology, AI, and machine learning.

These innovations enhance productivity and reduce the timeline for a pharmaceutical agent to reach the market from concept to production.

Indian pharmaceutical drug manufacturers are more likely to respond promptly through enhanced technologies, which will enable them to operate more efficiently and economically, thereby maintaining a very competitive advantage in the global marketplace.

The biosimilars sector is another area where India can expect significant growth. There have been significant advancements in the development and manufacture of biosimilars. The market for these expensive drugs is growing, and Indian companies have placed all their investments into R&D in this area.

Clinical trial investments are increasing, as India is considered a relatively affordable location for conducting them. Instead of producing only generic medications, Indian pharmaceutical companies are increasingly focusing on innovation and also developing new drugs.

Conclusion

It is not a coincidence that India has emerged as a significant global hub for pharmaceutical drug manufacturers. The nation has become a leader in the pharmaceutical space, thanks to a combination of low manufacturing costs, a skilled workforce, regulatory compliance, and international partnerships and alliances.

India is likely to solidify its position as a dependable source of high-quality, affordable drugs for global consumption while continuing to innovate and expand its manufacturing capacity.

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