PLI scheme helps start production of 22 key bulk drugs

In a bid to make the pharmaceutical sector self-reliant, India has started the production of 22 active pharmaceutical ingredients (API) or bulk drugs used for the manufacturing of life-saving drugs and high-end medical devices like CT scan and MRI machines, under the Production Linked Incentive (PLI) scheme.

Currently, India has 85% import dependency on APIs and 80% dependency on medical devices from other countries, especially China. The country imports APIs worth ₹35,000 crore each year from China, which is dominant in APIs, an essential input for developing drugs of even the most basic kind such as painkillers.

The Department of Pharmaceuticals (DoP) on Tuesday issued the first tranche of incentives under the PLI scheme of pharmaceuticals amounting to ₹166 crore to four selected applicants.

DoP had launched the PLI scheme for pharmaceuticals in 2021 with an outlay of ₹15,000 crore over six years.

“Under the PLI scheme for bulk drugs with a financial outlay of ₹6,940 crore with an objective to boost domestic production of 41 select critical bulk drugs in the country, So far, 51 projects have been selected for the 34 notified bulk drugs. Out of this, 22 projects have been commissioned till date (for projects of fermentation-based APIs, the production year as per the scheme guidelines is FY 2023-24),” Union health minister Mansukh Mandaviya said. Incentive rates for fermentation-based products are 20% and chemical-based products are 10% for initial four years of the scheme and it will taper for the subsequent two years.

Working on the vision of reducing import dependency through indigenous production, the government is focussing on production of high value pharmaceuticals and high-end medical devices, he said. Local manufacturing of components of high-end medical devices will be another big step in moving towards Aatmanirbharta, he added.

Earlier, commerce and industry minister Piyush Goyal stressed the need for India to be self-sufficient in critical areas as covid-19 has exposed the fragility of global supply chains.

India’s manufacturing sectors need to identify critical areas where it is essential for the country to achieve self-sufficiency, he said.