Mumbai: Pharmaceutical industry sees its raw materials costs rising due to an appreciation of the dollar, N.R. Munjal, president of the Indian Drug Manufacturers Association (IDMA), said on Friday.
“We import about 70% of raw material consumed in India and most of it comes from China. All these drug raw material contracts are in dollar terms,” Munjal said.
Rupee extended losses on Friday to slide to a fresh 28-month low as demand for dollars persisted in a risk-averse environment.
“Most traders settle bills by the end of the month and the costly dollar will badly hit them,” Munjal told the news agency.
India imports chemicals, intermediates and active pharmaceutical ingredients (APIs) worth $3-4 billion every year from China alone.
“The RBI or the government should look into this currency issue”, Munjal said.
India exported about $11 billion worth of pharmaceutical products in fiscal year 2011 and consumed drugs worth the same amount, Munjal said. India’s fiscal year 2012 pharma exports are seen rising 12-15%, he said, adding “global economic downturn will boost India’s drug exports.”
“Even if there is a downturn globally, the demand for medicines does not go down. In fact, Indian generics are cost effective and are preferred in regulated markets,” he said.
Of the $11 billion exports, about 70% is APIs while the rest are generic products, Munjal added.