HomeBusiness NewsThe government may bring a New PLI scheme for the pharma sector

The government may bring a New PLI scheme for the pharma sector

The government may bring a New PLI scheme for the pharma sector: The government is considering launching a new production-linked incentive (PLI) scheme for the pharmaceutical sector to boost the production of critical chemicals for manufacturing active pharmaceutical ingredients (APIs). According to the report, the purpose of doing this is to reduce the dependence of Indian companies on China for such supplies.

Moreover, the entire value chain of pharma is not covered under the current PLI, due to which these input chemicals are still imported in bulk from China.

According to a report, India’s dependence on Chinese pharma imports is 55-66 percent and is expected to remain high in the coming years.

“The new PLI can come only after the formation of the new government and can be a part of the next Union Budget,” he said.

The government may bring a New PLI scheme for pharma sector

According to a Care Ratings report, bulk drug imports from China have been growing in terms of both value and volume, increasing by 64 and 62 percent respectively in FY2014 and 71 and 75 percent in FY23.

“China’s unit cost for manufacturing these chemicals is very low, due to which Indian manufacturers import them for manufacturing APIs. Also, these chemicals are highly polluting. “The government may also consider modifying the existing PLI scheme in pharmaceuticals to include these chemicals within its scope,” it said.

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Under the existing Pharma PLI scheme, incentives are provided to the industry to manufacture key starting materials, pharmaceutical intermediates, and APIs locally. “But China has reduced prices on chemicals that are inputs for APIs. Other manufacturers (who are not part of the PLI scheme) can match the API cost because they are importing chemicals from China.

Relying too heavily on a single country for critical pharmaceutical ingredients poses risks to India’s pharmaceutical industry, as disruptions in the supply chain can lead to shortages and production delays.

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