Mr. Chandrajit Banerjee, Director General, CII welcomed the Cabinet approval of 100 % FDI for Medical Devices under the “automatic route”. He mentioned that this would meet a very long standing need for local manufacturing and technology infusion in the sector which continued to meet the growing healthcare needs of a vast country like India largely through imports. It clearly distinguishes the Medical Devices sector which is primarily greenfield so far, from the Pharmaceutical sector which was brown field and needed several protections. He expressed hope that this step will go a long way in making the “Make in India” programme happen for this sector as the Govt. was expected to continue to emit similarly positive signals to make the country an attractive for investors to make, market and export their products.
Welcoming the move, Mr Pavan Choudary, Chairman, Medical Technology Division of the CII and Managing Director, Vygon India Pvt Ltd, said “Since the time medical devices were classified as “Drugs” getting Foreign Direct Investment in this sector became a challenge. The figures as released by DIPP indicated that in the period April 2000 to June 2012, when Drugs and Pharmaceuticals witnessed FDI inflows of US$ 9659 million, Medical and Surgical appliance had FDI inflows of US$ 523 million only. The main reason for this scant FDI was that medical devices (as Drugs) had to go through the tedious FIPB route which was a time, effort and resource consuming affair. With the FDI now being allowed on an automatic route, the CII Medical Technolgy Divison was looking forward to a surge of interest in this area provided the market space stayed attractive enough for investment from MNCs through consistent policies on export, pricing and the manufacturing front.
Mr Himanshu Baid, Co-Chairman Medical Technology Division of the CII and Managing Director, Polymedicure Ltd said that this sector, to develop, needed strong infusion of international technology and required long gestation periods and deep pockets. This nascent, green field sector of Medical Devices by being clubbed with the Drugs and Pharmaceutical sector languished and accounted in India for as little as $ 2.5 billion (including Exports). This was only 1% of the World Market (the world Market being $ 250 billion) as compared to the Indian Drugs and Pharmaceuticals sector which stood at $ 20 billion (including exports) accounting for 7% of the World Pharmaceutical market of $ 300 billion.
New Delhi
24th December 2014