Indian Pharma Sector Mixed response over Union Budgetary Allocation
Indian Pharmaceutical industry is disappointed over Union Budgetary allocation as the finance minister proposed to invert the duty structure in the process of its “Make in India” policy may hamper the industry in a big way, due to over dependence of inexpensive raw materials from China.
According to Mr.D.G.Shah Secretary General of the Indian Pharmaceutical Alliance, the nodal agency for Indian Pharmaceutical Sector, “Amending the inverted duty structure is a right move in the right direction but its implication on Pharmaceutical Sector must be observed”. He continues, “The Government wanted to encourage producing raw materials, which acts as basic drug ingredients, in India as a part of Active Pharmaceuticals Ingredients (API) initiative, but if raw material import duty goes down to an extent it may create an adverse effect to produce those raw materials in domestic market.”
Overall, the budget doesn’t offer any direct benefit to the Pharmaceutical Industry, although it is a positive sign for Healthcare System, which includes various initiatives, the net disposable income for an average middle class group has gone up, which again mean more money flowing into Healthcare sector.
Following are the key highlights about the budgetary proposals as per the sector announced by the Finance Minister.
Encouraging raw materials produced domestically.
Extend health insurance cover to reach every individual and reduce personal spending from pocket.
Major setback led by the government for being non-supportive on investment flowing into R&D.
Reduction in minimum alternate tax benefit has not been extended to R&D.
Percentage of budgetary allocation on healthcare sector has not risen.
The budget allowed the EPF funds to be diverted into healthcare sector.
Insurance along with universal health coverage has been revived in a unique and strategic manner.
Imposing health tax is a major drawback set by the government due to lack of funding hampers the healthcare sector.
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