Rohit Shishodia
India’s Ministry of Chemicals and Fertilizers has relaxed various conditions attached with its schemes for promoting domestic manufacturing of bulk drugs and medical devices. These relaxations include softening of minimum investment requirements and giving permission to export, among others. The last date for applying under these schemes is now November 30, 2020.

India’s Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, has revised the Production Linked Incentive (PLI) Schemes for promoting domestic manufacturing of bulk drugs and medical devices keeping in view the suggestions and comments received from the industry.

Accordingly ‘minimum threshold’ investment requirement has been replaced by ‘committed investment’ taking into account availability of technology choices which varies from product to product.

The Department of Pharmaceuticals earlier come out with the following two Production Linked Incentive schemes-

Production Linked Incentive scheme for promotion of domestic manufacturing of critical Key Starting Materials, Drug Intermediates and Active Pharmaceutical Ingredients in India

Production Linked Incentive Scheme for Promoting Domestic Manufacturing of Medical Devices

Both the schemes were approved by the Cabinet on 20.03.2020.

Post issuance of the detailed guidelines, the department received several suggestions and inputs from the pharmaceutical and medical device industry seeking certain amendments in the scheme to enable effective participation of the industry in the two schemes. The revised guidelines have been issued on 29.10.2020 and are available on the website of the Department of Pharmaceuticals under the tab “schemes”.

In both the schemes, criterion of ‘minimum threshold’ investment has been replaced with ‘committed’ investment by the selected applicant. The provision for verification of the actual investment made by the selected applicant for the purpose of giving incentives under the scheme continues.

Main changes in the revised guidelines for Production Linked Incentive (PLI) scheme for promotion of domestic manufacturing of critical Key Starting Materials, Drug Intermediates and Active Pharmaceutical Ingredients in India are as follows:

The provision which restricts the sales of eligible products to domestic sales only, for the purpose of eligibility of receiving incentives, has been deleted bringing the scheme in line with other PLI schemes and encouraging market diversification.

Change in the minimum annual production capacity for 10 products viz Tetracycline, Neomycin, Para Amino Phenol (PAP), Meropenem, Artesunate, Losartan, Telmisartan, Acyclovir, Ciprofloxacin and Aspirin. Minimum annual production capacity is a part of eligibility criteria under the scheme.

The main changes which have been effected in the revised guidelines for Production Linked Incentive Scheme for Promoting Domestic Manufacturing of Medical Devices are as follows-

Change in the eligibility criteria of minimum sales threshold in line with projected demand, technology trend and market development, for the purpose of availing incentive under the scheme.

The tenure of the scheme has been extended by one year keeping in view the capital expenditure expected to be done by the selected applicants in FY 2021-22. Accordingly, the sales for the purpose of availing incentives will be accounted for 5 years starting from FY 2022-2023 instead of FY 2021-2022.