29 C
Delhi
Thursday, September 24, 2020

India’s incentives for API production may cut supply risk: Fitch

- Advertisement -

India's GDP growth is still solid against that of peers: FitchNew Delhi (IANS) The government’s decision to incentivise domestic manufacturing of active pharmaceutical ingredients (API) and key starting materials (KSM) could curtail supply-chain disruption risk for Indian drug makers, Fitch Ratings said on Monday.

The ratings agency said that the incentives address core issues of pricing competitiveness and funding and may assist the investment decisions of local pharma companies in the current environment.

“India is one of the world’s leading suppliers of drugs – mostly generic formulations – but depends on imports for its requirement of APIs and KSMs, particularly China, which accounted for more than 60 per cent of requirements in some therapy areas,” Fitch Ratings said in a statement.

“The government announcements follow recent developments, including plant closures in China due to the coronavirus pandemic earlier in the year and the more recent border standoff with China, which underscore supply-disruption risk due to overdependence on imports.”

As per the statement, India’s reliance on pharma ingredient imports has risen over the past few decades due to the higher cost of domestic production, with the price gap reaching as much as 20-30 per cent, particularly for energy-intensive fermentation-based ingredients used in anti-infectives.

Import dependence is more than 90 per cent for some life-saving drugs, including penicillin and ciprofloxacin.

“We believe the government announcement, which includes production-linked incentives and financial assistance schemes aggregating to $1.3 billion, will help address the two keys issues; the higher cost of domestic production compared with imports and funding requirement to set up the necessary infrastructure,” the statement said.

“The production-linked incentive scheme – which accounts for Rs 0.9 billion of planned outlay – offers an incentive of up to 20 per cent of sales for fermentation-based products and up to 10 per cent for chemical synthesis-based products for the next eight to nine years. This should help to bridge the price gap and make domestic production more competitive.”

The government has also allocated $0.4 billion under the capex assistance scheme to fund up to 90 per cent of the investment need to build common infrastructure facilities in three bulk drug parks.

“We believe this will aid the investment decisions of Indian pharma companies, particularly in the current environment where the focus in on conserving cash,” the statement said.

“While these incentives aim to encourage incremental investment to ensure uninterrupted supplies for domestic needs, companies with existing API production capabilities… could benefit from export opportunities over the medium- to long-term as pharma companies globally look to diversify their sourcing – a theme that has gained relevance due to the pandemic.”

–IANS

India Updates
India Updates is an independent news & Information website. Follow us for regular updates on News and Information.

Follow Us On

Related News

CAG finds issues in MEIS module, use of wrong forex rates

New Delhi, Sep 24 (IANS) The Comptroller and Auditor General (CAG) of India has found deficiencies in the module of Merchandise Exports from India...

FB, YouTube, Twitter ink pact with advertisers on hate speech

San Francisco, Sep 24 (IANS) After months of intensive talks with major advertisers, Facebook, YouTube and Twitter have agreed to adopt a common set...

Ayushmann Khurrana among 5 Indians in Time list of Influential People

Mumbai, Sep 24 (IANS) Indian actor Ayushmann Khurrana is in the Time magazine list of 100 Most Influential People this year.The National Award-winning Bollywood...

Govt sweetens discom privatisation plan to attract investment

By Subhash Narayan, Sep 24 (IANS) The government has sweetened the deal to privatise state-owned power distributions operations in Union Territories as 100 per...

Players focussed on attaining peak fitness: Hockey captain Manpreet

By Rohit Mundayur, (IANS) Senior men’s hockey probables at the Sports Authority of India’s (SAI) Bengaluru centre are currently focussed on getting as close...

Honoured to be part of PM Modi’s Fit India Dialogue: Kohli

New Delhi, Sep 23 (IANS) Indian cricket team captain Virat Kohli has stated that he is honoured to be part of the Fit India...

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Trending Topics In India

Covid 19 India Updates

PM Modi asks states to focus on micro-containment zones

New Delhi, Sep 23 (PTI) Prime Minister Narendra Modi on Wednesday asked states to reassess if lockdowns of one or two days are effective...

PM Modi asks states to focus on micro-containment zones

New Delhi, Sep 23 (PTI) Prime Minister Narendra Modi on Wednesday asked states to reassess if lockdowns of one or two days are effective...

People with ‘silent’ Covid-19 may have key role in spread

Seoul, Sep 23 (IANS) People with 'silent' or asymptomatic Covid-19 infection have as much coronavirus in their noses and throats as those with symptoms,...

Epidemic Diseases Bill passed in LS to protect frontline Covid workers

New Delhi, Sep 22 (IANS) A bill which proposed protection to frontline workers, including healthcare professionals, was passed on late Monday night proceedings of...

Not believe in act of God, Covid vaccine expected in early 2021: Harsh Vardhan

New Delhi, Sep 22 (IANS) Union Health Minister Harsh Vardhan assured the Lok Sabha that the Central government is not just waiting for "act...

COVID-19 recovery rate in India crosses 80 per cent mark

New Delhi, Sep 21 (PTI) India''s recovery rate of COVID-19 cases has crossed the 80 per cent mark with over 90,000 recoveries recorded for...

Trending News In India

India successfully flight-tests Make In India target drone Abhyas

New Delhi, Sep 22 (IANS): India on Tuesday successfully flight tested Abhyas, a high-speed target drone for practice of weapon systems with realistic threat...

FB, YouTube, Twitter ink pact with advertisers on hate speech

San Francisco, Sep 24 (IANS) After months of intensive talks with major advertisers, Facebook, YouTube and Twitter have agreed to adopt a common set...

Ayushmann Khurrana among 5 Indians in Time list of Influential People

Mumbai, Sep 24 (IANS) Indian actor Ayushmann Khurrana is in the Time magazine list of 100 Most Influential People this year.The National Award-winning Bollywood...

Govt sweetens discom privatisation plan to attract investment

By Subhash Narayan, Sep 24 (IANS) The government has sweetened the deal to privatise state-owned power distributions operations in Union Territories as 100 per...

Work from home culture to continue even after pandemic ends: Bill Gates

Mumbai, Sep 23 (PTI) The work from home culture has worked well and many companies will continue with the system even after the coronavirus...

Labour reforms will ensure well-being of workers, give economic boost: PM

New Delhi, Sep 23 (PTI) Prime Minister Narendra Modi on Wednesday hailed the passage of key labour reform bills by Parliament, saying it will...

Trending Showbiz

NCB summons to Deepika, Shraddha, Sara in drugs-related case

Mumbai, Sep 23 (IANS) In a major development, the Narcotics Control Bureau (NCB) on Wednesday said that it has summoned Bollywood actors Deepika Padukone, Sara...

NCB summons to Deepika, Shraddha, Sara in drugs-related case

Mumbai, Sep 23 (IANS) In a major development, the Narcotics Control Bureau (NCB) on Wednesday said that it has summoned Bollywood actors Deepika Padukone, Sara...

Bhumi Pednekar: I’m creatively very restless

Mumbai, Sep 22 (IANS) Actress Bhumi Pednekar, who has worked in genres as different as chalk and cheese, says she is creatively very restless."I...

Sachin Khedekar: No actor can rise above a bad script

Mumbai (IANS) Actor Sachin Khedekar believes a good script is truly important for an actor to showcase his acting skills.“The script plays one of...

Negativity not in Bollywood, exists only on TV channels: Anubhav Sinha

By Justin Rao, Mumbai, Sep 21 (PTI) Anubhav Sinha says the negative perception about the Hindi film industry has been manufactured on TV news...

Don’t ask actors about things not related to them: Manoj Bajpayee

BY DURGA CHAKRAVARTY (IANS) Bollywood celebrities are asked for their opinions on just about everything these days, National Award-winning actor Manoj Bajpayee notes. How...

Trending Sports

Players focussed on attaining peak fitness: Hockey captain Manpreet

By Rohit Mundayur, (IANS) Senior men’s hockey probables at the Sports Authority of India’s (SAI) Bengaluru centre are currently focussed on getting as close...

Honoured to be part of PM Modi’s Fit India Dialogue: Kohli

New Delhi, Sep 23 (IANS) Indian cricket team captain Virat Kohli has stated that he is honoured to be part of the Fit India...

Samson, Smith, Tewatia shine as Royals stun CSK by 16 runs

Sharjah, Sep 23 (IANS/GloFans) Sanju Samson's blistering 32-ball 74 at No.3, fast bowler Jofra Archer's fireworks with the bat -- he carted four consecutive sixes...

Novak Djokovic completes 286th week as No.1, pips Sampras

Rome, Sep 22 (IANS) Novak Djokovic, who has started his 287th week at the number one position in the ATP Rankings, has gone past...

Tokyo Olympics will be my best, says archer Atanu Das

New Delhi, Sep 22 (PTI) Indian archer Atanu Das has vowed to dish out his best performance at next year''s Tokyo Games, saying he...

Padikkal, Chahal star in RCB’s win over SRH

Dubai, Sep 21 (IANS) A brilliant half-century from debutant Devdutt Padikkal followed by some class spin bowling from Yujvendra Chahal helped Royal Challengers Bangalore...

Latest Trending News In India

CAG finds issues in MEIS module, use of wrong forex rates

New Delhi, Sep 24 (IANS) The Comptroller and Auditor General (CAG) of India has found deficiencies in the module of Merchandise Exports from India...

FB, YouTube, Twitter ink pact with advertisers on hate speech

San Francisco, Sep 24 (IANS) After months of intensive talks with major advertisers, Facebook, YouTube and Twitter have agreed to adopt a common set...

Ayushmann Khurrana among 5 Indians in Time list of Influential People

Mumbai, Sep 24 (IANS) Indian actor Ayushmann Khurrana is in the Time magazine list of 100 Most Influential People this year.The National Award-winning Bollywood...

Govt sweetens discom privatisation plan to attract investment

By Subhash Narayan, Sep 24 (IANS) The government has sweetened the deal to privatise state-owned power distributions operations in Union Territories as 100 per...

Work from home culture to continue even after pandemic ends: Bill Gates

Mumbai, Sep 23 (PTI) The work from home culture has worked well and many companies will continue with the system even after the coronavirus...