PLI scheme may help reduce India's dependence on API imports:Ind-Ra
text_fields
New Delhi:The rating agency, India Ratings and Research (Ind-Ra),expects key reduction in India's dependence on imports for key active pharmaceutical ingredients (APIs) with production-linked incentive (PLI) scheme.
"The scheme will not only attract foreign investments, but also promote the development of complex and high-tech products, emerging therapies and in-vitro diagnostic devices in India" it said.
The rating agency expects import dependency to reduce around 43 per cent in the medium term from around 70 per cent currently.
"The benefits of the scheme will be a function of the pace of rollout of the scheme and interest of Indian pharmaceutical companies" it added.
The agency opined that the scheme will benefit API manufacturers by giving them extra push to setup the necessary infrastructure along with their pre-planned infrastructure.
"Bulk drug parks will help integrate infrastructure facilities, thereby reducing the manufacturing cost of APIs. Ind-Ra believes, if bulk drug parks are setup as envisaged to address infrastructure and approval issues, this will improve the ease of doing business" said Ind-Ra.
The agency also believes the PLI scheme to be a positive step in reducing India's dependence on China, though the benefits of the scheme will be visible after five to seven years.
"Repeated raw material supply disruptions from China has been a cause of concern for global pharma companies including India, due to their high dependency on China", agency said.
Meanwhile, as per the government estimates, the PLI scheme is expected to bring in investment of Rs 150 billion in the domestic pharmaceutical sector.