Govt to soon remove duty anomalies in medical devices sector

The government is working on several steps, including removing duty anomalies, to boost medical devices manufacturing sector and make it a USD 50 billion industry in the next five years, a top official today said.
Secretary in the Department of Pharmaceuticals, V K Subburaj, said that soon recommendations will be made to rectify the inverted duty structure for the growing medical devices sector.
He said departments of health and pharmaceuticals along with the Department of Industrial Policy and Promotion (DIPP) is working on the matter and soon they will make recommendations to the revenue department on the issue.
An inverted duty structure impacts domestic industry adversely as manufacturers have to pay a higher price for raw material in terms of duty, while imported finished products land at lower duty and cost lesser.

"The important hurdle (which the sector is facing) is the regulatory mechanism...The duty structure has to be modified. Health, DIPP and Pharma are jointly discussing the issue... Probably by next week, we will finalise the recommendations," Subburaj said here at a CII function.
Domestic medical devices makers have been asking the government to address this issue.

"We will ensure that this deficiency gets corrected very shortly. That will set the tone for medical devices industry in the country," he added.
Commenting on the potential of the sector, he said: "Now we have to scale it to USD 50 billion and to enable that, we have to take policy decisions."

Currently, the medical devices industry in India is estimated to be USD 5 billion annually.
The secretary also said the department is working to create a separate vertical for medical devices in the Drugs and Cosmetics Act.
"Once it becomes a USD 50 billion industry, I do not think we can afford to combine it with the Drugs and Cosmetics Act. There should be a separate Act for the sector," he said.
"We have combined it with drugs for long and that mistake is likely to be sorted out shortly. I think very shortly we will have a separate vertical within this Act exclusively for medical devices," Subburaj said.

To give an identity to the subject, he said, the government has empowered the Pharmaceuticals Department to take the medical devices sector.
Earlier, different departments were handling different issues related with the sector such as - quality control was looked after by the Health ministry, FDI by the DIPP and export was taken care by the Commerce Ministry.
The department, he said, is also working on the issue of the preference purchase procedures.
"We are discussing with the electronics and MSME departments to see that products manufactured in India, especially made by medium and small scale sector, get preference for purchase," he said.