Competitive edge of Indian pharmaceutical industry

Competitive edge of Indian pharmaceutical industry

The Indian pharmaceutical industry has gained the distinction of exporting quality and affordable medicines to more than 200 countries. It has been widely acknowledged as “Pharmacy of the World”.

Globally Indian Pharma is ranked third in terms of pharmaceutical production by volume. During 2021-22, total exports of pharmaceuticals stood at ? 1,74,955 crore (US$ 23.5 billion) which is a reflection of world’s trust on India produced medicinal products.

Indian pharma has been expanding its research and development (R&D) wing. The expansion of R & D ecosystem and increasing export has established the country’s potential in pharmaceuticals.

Pharmaceutical sector is one of the favourite sectors for foreign investors. Investor friendly foreign direct investment (FDI) policy is in place to promote investment in pharmaceutical sector.

Up to 100 per cent FDI in greenfield projects and up to 74 per cent in brownfield projects is allowed under automatic route. FDI beyond 74 per cent in brownfield only requires government approval.

The Department of Pharmaceuticals is the agency authorised to consider foreign investment proposals under the government approval route. During the financial year 2022-23 (till December 2022), Department of Pharmaceuticals approved 13 FDI proposals that would result in foreign investment inflow of ? 2,814 crore in the brownfield projects of pharmaceutical sector.

FDI inflow has increased substantially over the years: ? 1842 crore in 2018 – 2019 financial year to ? 10552 crore in 2021 – 2022 showing a whopping increase of 473 per cent.