CII demands sops to boost mfg in medical devices sector

Industry body CII has submitted a set of recommendations to the Department of Pharmaceuticals (DoP), demanding promotion of the components and ancillary industry in the Preferential Market Access (PMA) policy to give boost to the medical devices sector.
Besides, it has also demanded incentives for exports and manufacturing, access to low-cost capital, tax sops, etc.
"Access to low-cost capital through soft loans, subsidised land and assured power and water supply combined with tax incentives and single-window clearance, would certainly build a stronger business case in India," said Pavan Choudary, Co-Chairman, CII Medical Technology Department.
Regarding implementation of the PMA Policy, Chairman of CII Medical Technology Department Himanshu Baid said: "Without the availability of indigenous components, the PMA policy will not yield any results as already seen in the electronics and IT hardware sector since the last four years."

"Before the implementation of PMA policy in medical devices and equipment sector, there is a need to properly analyse the components of manufacturing capabilities in India".
The industry body emphasised that manufacturing business case in India is quite challenging.

"While the labour costs are lower in the country, the capital investment and productivity of the labour are critical limiting factors to the manufacturing business case. Combined with approval delays, this makes the manufacturing environment quite challenging for entrepreneurs," it said.
To begin with, CII suggested, only MSME/SME industry components be given preference in the PMA policy.
Among other measures, it suggested that the process of setting up manufacturing facilities needs to be streamlined by designating medical technology hubs all over the country with the right infrastructure in place to support the complex medical technology manufacturing.

It also recommended that medical technology hubs be set up in each zone across the country, and demanded manufacturing incentives like tax support and low-cost funding (5 per cent lower rate than the bank lending rates) to spur investments and make the business case attractive.
CII also demanded concessional power tariff in manufacturing hubs and subsidised land prices for setting up medical devices industry in medical technology hubs.
Moreover, it said, inverted duty structure should be corrected. Customs import duty on raw materials should be lower than finished goods.
Besides, CII said, the three year market standing required for new manufacturing units to participate in Government tenders should be done away with, and emphasised the need for further capacity building in the sector and focus on quality enhancement to reduce imports.