Departments of health and pharmaceuticals along with DIPP is working and soon recommendations will be made to the revenue department on the issue
The government is working on several steps, including removing duty anomalies, to boost medical devices manufacturing sector and make it a $50 billion industry in the next five years, a top official said.
According to a report in PTI, Secretary in the Department of Pharmaceuticals, V K Subburaj, said that soon recommendations will be made to rectify the inverted duty structure for the growing medical devices sector. He said departments of health and pharmaceuticals along with the Department of Industrial Policy and Promotion (DIPP) is working on the matter and soon they will make recommendations to the revenue department on the issue.
An inverted duty structure impacts domestic industry adversely as manufacturers have to pay a higher price for raw material in terms of duty, while imported finished products land at lower duty and cost lesser.
“The important hurdle (which the sector is facing) is the regulatory mechanism. The duty structure has to be modified. Health, DIPP and Pharma are jointly discussing the issue. Probably by next week, we will finalise the recommendations,” Subburaj said at a CII function in New Delhi.
Domestic medical devices makers have been asking the government to address this issue. “We will ensure that this deficiency gets corrected very shortly. That will set the tone for medical devices industry in the country,” he added.
Commenting on the potential of the sector, he said, 哲ow we have to scale it to $50 billion and to enable that, we have to take policy decisions.”
Currently, the medical devices industry in India is estimated to be $5 billion annually. The secretary also said the department is working to create a separate vertical for medical devices in the Drugs and Cosmetics Act.
“Once it becomes a $50-billion industry, I do not think we can afford to combine it with the Drugs and Cosmetics Act. There should be a separate Act for the sector,” he said. “We have combined it with drugs for long and that
mistake is likely to be sorted out shortly. I think very shortly we will have a separate vertical within this Act exclusively for medical devices,” Subburaj said.
To give an identity to the subject, he said, the government has empowered the Department of Pharmaceuticals to take the medical devices sector. Earlier, different departments were handling different issues related with the sector such as – quality control was looked after by the health ministry, FDI by the DIPP and export was taken care by the Commerce Ministry.
The department, he said, is also working on the issue of the preference purchase procedures. “We are discussing with the electronics and MSME departments to see that products manufactured in India, especially made by medium and small scale sector, get preference for purchase,” he said.
To ensure that devices made by domestic firms get purchase preference, the pharma department is also mulling modifying the tender documents because it is one of the important recommendations by the task force.
Explaining the rationale, he said local manufacturers should get the preference as they have invested a lot of money amid fears that their products may not find too many takers. He, however, added that this should not imply that India
is not going to purchase from other countries. More than two-thirds of the medical equipment are imported in the country. He also said some of the locally-manufactured equipment are competitive both in quality and price.
A total of 800 units manufacture medical equipment in India across large, medium and small sectors and with the higher turnover of healthcare sector, the number would go up in the near future, he added.
Presently, departments like science and technology, biotechnology, and specialised institutions are engaged in research and development in the sector in coordination with the pharma department.
“If there is a linkage between various departments and stakeholders, we can come out with many innovations. The pharma department will coordinate all research programmes,” he said adding that a separate portal will be created to let people know about the kind of research going on in the country. A ‘Year Book’ listing out innovations, expertise and discoveries, will also be released annually to create an ecosystem for boosting R&D in the segment.
Subburaj also pointed out the high cost of healthcare and ways to reduce it. By making medical system cost effective, there is tremendous scope for expanding the healthcare system, he said.
The government is also contemplating sale of prime properties worth thousands of crores owned by pharma firms Hindustan Antibiotics and IDPL, lying unutilised in cities like Mumbai, Pune and Hyderabad.
Talking to reporters on revival of these state-owned units, he said the department is expected to approach the Cabinet in the next two months regarding sale of the land of the two units. he secretary said that by selling the land, debt and other dues could be paid. “We can go to the cabinet in another 2 months,” he said. On a question regarding strategies to improve bulk drug manufacturing capacity in India, he said discussions are on and in another two months, something may come out. The move is aimed at reducing dependence on China for import of bulk drugs.