Medical devices sector requires incentives for growth: AdvaMed

Medical devices sector in India requires incentives like medical technology parks, reduced customs duty on raw material, excise duty concessions, VAT holidays and IT holiday to achieve its growth potential, a sectoral body has said ahead of the union budget.
Medical technology parks, for instance, where a cluster of manufacturers of medical devices is fostered through the provision of basic infrastructure, would encourage innovation, association of medical device manufacturers AdvaMed said in a statement.
Furthermore, there is a need for R&D grants and subsidies in the medical technology space to promote domestic innovation initiatives, it added.
"To ensure that there is thrust in the research and development area for design as well as innovation of these products, special incentives must be offered to get more participants in this," AdvaMed Vice President Abby Pratt said.

As the benefits to society from such projects would be significant, the medical device industry is suggesting that incentives in the form of income tax write-offs for up to 250 per cent of the value of investment for R & D and innovation of medical instruments, diagnostics instruments, consumables, devices, etc should be offered, she added.
AdvaMed is seeking 'very low level' of customs duty on import of finished products and nil customs duty for the import of raw materials, parts, sub-assemblies required for ultimate local manufacturing of instruments, accessories and consumables as part of its wish list from the budget.

The sectoral body has also demanded that the service tax on service and maintenance contracts for medical equipments be either exempted fully or a minimal rate of tax prescribed.
The excise duty on medical equipments should be reduced significantly and may be prescribed at the lowest slab to enable the domestic industry to find a foothold, it added.