Here is why India needs to be 'atma nirbhar' in pharma sector

New Delhi: Union health minister Mansukh Mandaviya recently said to boost domestic production of 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 to date.

For those who keep a keen eye on the state of India-China relations, this is an important statement that warrants more attention.

The government informed parliament last year that India is one of the major producers of Active Pharma Ingredients (API) or bulk drugs in the world.

“India exported Bulk Drugs/Drug Intermediates worth Rs. 33,320 crores in the financial year 2021-22. However, the country also imports various Bulk Drugs/APIs for producing medicines from various countries and most of the imports of the Bulk Drugs/APIs being done in the country are because of economic considerations. India imported Rs. 35,249 crore worth APIs and Bulk drugs in 2021-22,” minister of state for chemicals and fertilizers Bhagwanth Khuba had told Rajya Sabha in a written reply.

According to Pharma experts drugs are made up of two core components. First is API which is produced from raw materials with the required strength and chemical concentration and the second component is excipient which includes substances that is not drug but helps in delivering medication.

Indian pharmaceutical industry is heavily dependent on China for the import of APIs to manufacture drugs, especially those that are critical for saving lives.

There was a shortage of APIs in India for a short period of time when China restricted their export during the Covid pandemic. This huge dependence on Chinese imports is a threat to Indian economic stability as well as health security. That’s why the government brought in the Production Linked Incentive (PLI) Scheme for the promotion of domestic manufacturing of critical Key Starting Materials (KSMs) or Drug Intermediates (DIs) and Active Pharmaceutical Ingredients (APIs) in India.

India-China trade is heavily skewed in favour of China and the pharmaceutical industry is one such example where the Indian reliance on Chinese imports has been specially pointed out by the Indian security establishment.

In a paper submitted for the annual conference of police chiefs it was pointed out that in the case of life-saving drugs, India’s dependence on China is almost 90 per cent.

The parliamentary standing committee on commerce in a report in 2018 stated that a long-term view of the Pharma industry should be taken to promote competitiveness and price stability.

It was also stated that 20 years back, India used to provide 90 per cent of API requirements but mainly dumping from China destroyed its API industry and now a major portion of Indian API requirements is met by imports.

The continuous rise of imports from China, given its aggressive posturing on the Line of Actual Control in recent years, is a matter of serious concern.

Security analysts have suggested that India should impose the maximum import duty permitted under the WTO rules on Chinese imports to reduce the trade deficit of China and it also saves critical foreign exchange.