Lok Sabha Question No. 3236 (UNSTARRED), answered on 2021-12-17
Subject: Promotion and Expansion of Pharma and Medical Devices Industry
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Naranbhai Bhikhabhai Kachhadiya, Parbatbhai Savabhai Patel

## GOVERNMENT OF INDIA MINISTRY OF CHEMICALS AND FERTILIZERS DEPARTMENT OF PHARMACEUTICALS

LOK SABHA UNSTARRED QUESTION No. 3236 TO BE ANSWERED ON THE 17 th  December, 2021

## Promotion and Expansion of Pharma and Medical Devices Industry

## †3236. SHRI NARANBHAI KACHHADIYA: SHRI PARBATBHAI SAVABHAI PATEL:

Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state:

- (a) whether there are enormous opportunities for participation in the field of manufacturing of medicine and medical equipments and if so, the details thereof;
- (b) the details of expansion of existing pharmaceutical industry undertaken in the country; and (c) the efforts made/being made by the Government to establish new pharmaceutical industry in the country including Gujarat?

## ANSWER

## MINISTER IN THE MINISTRY OF CHEMICALS AND FERTILIZERS (Dr. MANSUKH MANDAVIYA)

(a) to (C): Yes, Sir.

India is the third largest player globally in Pharmaceuticals in terms of volume and is the largest supplier of low cost generics and vaccines to the world. The sector has immense growth potential in the sphere of generics, bulk drugs, vaccines and biosimilars. The potential for the Medical Device industry growth is the highest among all the sectors in the healthcare market.  Various  categories  of  devices  starting  from  consumables  to  implantable  medical devices  are  being  manufactured  in  India.  The  Medical  Device  industry  is  highly  capital intensive with a long gestation period and requires development/induction of new technologies.

The FDI Policy of India is very liberal for the pharmaceutical and medical device sector. For Pharmaceuticals investment in greenfield sector upto 100% is permitted under automatic route while Investment in brownfield sector upto 74% is permitted under automatic route. For medical device sector, investment is permitted upto 100% under automatic route.

The  government  is  also  taking  steps  in  the  form  of  various  schemes  to  attract investments in both the sectors. The following are the details of the schemes:

(I) Production Linked Incentive (PLI) Scheme for promotion of domestic manufacturing of  critical  Key  Starting  Materials  (KSMs)/  Drug  Intermediates  (DIs)  and  Active Pharmaceutical Ingredients (APIs) In India: The objective of the Scheme is to attain selfreliance and reduce import dependence  in critical Starting  Materials  (KSMs)/  Drug Intermediates  (DIs)  and  Active  Pharmaceutical  Ingredients  (APIS).  The  tenure  of  the  subscheme is from financial year 2020-21 to 2029-30, with the total financial outlay of Rs.6,940 crore.  The  Financial  incentive  under  the  sub-scheme  is  provided  on  sales  of  41  identified products categorized into four Target Segments. Under the Scheme, 50 applicants have been approved with committed investment of Rs 4,498.38 crore and employment generation of about 10,743.

- (II) Production Linked Incentive Scheme for Pharmaceuticals: The scheme provides for financial  incentives  to  manufacturers  for  drug  formulations,  bulk  drugs  and  IVDs  in  three categories. The incentives are to be given on incremental sales to selected participants for a period of 6 years. The total financial outlay of the scheme is Rs. 15,000 crore and the tenure of the  schemes from  FY 2020-2021 to 2028-29. Fifty-five (55) applicants  have been selected under the scheme.
- (III) PLI Scheme for promoting Domestic Manufacturing of Medical Devices: The Scheme intends to boost domestic manufacturing and attract large investments in the Medical Devices Sector. The financial incentive is to be given to selected companies on incremental sales of medical devices manufactured in India and covered under the Target segments of the scheme, for a period of five (5) years. The tenure of the scheme is from FY 2020-21 to FY 2027-28 with total financial outlay of Rs.3,420 crore. Under the Scheme, 42 applicants have been approved with a total Committed Investment of Rs. 1059.33 Crore and employment generation of about 6,411.
- (IV) Scheme for Promotion of Bulk Drug Parks: The scheme provides for grant-in-aid to three  (03)  Bulk  Drug  Parks  for  creation  of  Common  Infrastructure  Facilities  (CIF)  with  a maximum limit of Rs.1000 crore per park or 70% of the project cost of CIF, whichever is less. In  case  of  North  Eastern  states  and  Hilly  States  (Himachanl  Pradesh,  Uttarakhand,  Union Territory  of  Jammu  &  Kashrnir  and  Union  Territory  of  Ladakh),  the  maximum  limit  of financial assistance would be Rs 1000 crore or 90% of the project cost whichever is less than total financial outlay of the Scheme is Rs. 3000 crore and the tenure of the Scheme is from FY 2020-21 to 2024. Proposals from 13 States have been received under the scheme which are under evaluation.
- (V) "Promotion of Medical Devices Parks": Under this Scheme a onetime grant-in-aid will be provided for creation of common infrastructure facilities in selected Medical Device Park proposed by a State Government. The total financial outlay of the scheme is Rs. 400 crore (Rs. 100 crore for each MD Park). The tenure of the scheme is from FY 2020-2021 to FY 20242025.  Under  the  scheme,  proposals  seeking  financial  assistance  from  16  States/Union Territories have been received. After evaluation of the proposals, the Government vide letter dated 24.09.2021 has in-principally approved financial assistance for common infrastructure facilities for 4 medical device parks i.e. Himachal Pradesh, Tamil Nadu, Madhya Pradesh and Uttar Pradesh.

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