Pharma, med tech not sure of govt targets

The government expects bulk drug and medical device parks to attract cumulative investment of about Rs 77,900 crore and generation of about 2,55,000 employment. The industry, however, finds it very ambitious.

The government had announced schemes for development of three bulk drug parks and four medical device parks. Apart from increasing central assistance for development of common infrastructure facilities in the parks, the government will also extend production-linked incentive (PLI) to manufacturers of bulk drugs and medical devices in these parks.

“Government will provide an incentive at the rate of 5 per cent on incremental sales for a period of five years from 2021-22 to 2025-26 with a total outlay of Rs 3.420 crore, minister of chemicals and fertilisers D. V. Sadananda Gowda said at an event.

According to him, bulk drug and medical device parks are expected to attract cumulative investment of about Rs 77,900 crore and can generate about 2,55,000 employment. For the medical device sector alone, investment could be to the tune of Rs 40,000 crore with generation of 1,40,000 new employment opportunities.

However, the industry is not quite convinced about the government estimate. “This is the assumption of the government. We will have to wait and watch. They assume that companies will leave China and come here. But that might not happen immediately. Even among domestic companies we have not seen a huge interest to invest thousands of crores,” said G.S.K. Velu, chairman and MD of Trivitron Healthcare.

According to pharma veteran S. V. Veeramani, some states like Haryana, Gujarat and Telangana have evinced interest in setting up the parks. “Pharma companies might be interested in establishing API manufacturing plants. But whether, they will bring in around Rs 38,000 crore of investment has to be seen,” he said.