Parliamentary panel pulls up HealthMin over drug scheme funding gaps

Panel flags funding discontinuity in drug regulation scheme, urges swift SSDRS 2.0 approval and decentralisation of medical device clearances to ease bottlenecks and improve oversight

Raising concerns over disruptions and structural inefficiencies in India’s drug and medical device regulatory framework, a parliamentary standing committee has asked the Department of Health & Family Welfare (DoHFW) to secure immediate approval of funds under the Strengthening of States’ Drug Regulatory System (SSDRS) scheme.

 

In its report reviewing the health ministry’s demand for grants, the parliamentary committee on health and family welfare said the SSDRS scheme — aimed at improving drug quality oversight and access to affordable medicines — has seen a sharp funding break.

 

According to the data, the ministry was allocated ₹75 crore for the scheme in the Budget Estimates (BE) for 2024–25. The Revised Estimates (RE) were cut to ₹50 crore, of which ₹48.32 crore, or 96.6 per cent, was spent. However, while ₹50 crore was earmarked in BE 2025–26 (FY26), the revised allocation for the year fell to nil. Expenditure for FY26 also remained nil until January 2026. The scheme received zero allocation in the Union Budget for 2026–27 (FY27).

 

“The committee is concerned that such an abrupt financial hiatus, resulting from procedural delays in approving the scheme’s extension and the subsequent SSDRS 2.0 proposal, threatens to derail the infrastructural gains achieved since inception,” the panel, headed by Rajya Sabha Member of Parliament Ram Gopal Yadav, said.

 

On the absence of allocation in FY26, the DoHFW said the scheme had been extended till March 31, 2026, without further outlay, following a no-objection from the Department of Expenditure (DoE) in January 2026. “However, by that time, the RE for FY26 had already been reduced to zero,” the department observed.

 

On the zero allocation for FY27, the department said no funds were provided under the existing SSDRS as the scheme period had ended. A revamped SSDRS 2.0 has been proposed with an outlay of ₹496.16 crore over five years (2026–27 to 2030–31). “The proposal for SSDRS 2.0 is under consideration of the DoE, and allocation for FY27 will be made subject to its approval,” the department added.

 

“The committee recommends that the department pursue immediate approval of the ₹496.16 crore SSDRS 2.0 scheme,” the panel said.

 

It also asked the DoHFW to explore interim funding mechanisms or supplementary grants to ensure that 19 new and 28 upgraded state drug testing laboratories do not face operational paralysis while awaiting rollout of the revamped scheme.

 

The report said that while SSDRS 1.0 expanded testing capacity from 57,000 to over 166,000 samples annually, its impact is constrained by persistent manpower shortages at the state level.

 

“The committee believes that state-of-the-art testing infrastructure is rendered ineffective without an adequate cadre of trained analysts and strong enforcement mechanisms,” it said.

 

It added that the risk-based inspection framework must be institutionalised, standardised, and fully digitised across all state drugs control offices to ensure enforcement remains consistent, transparent, and data-driven.

 

Panel pushes to decentralise medical device approvals

 

Flagging delays and procedural inefficiencies at the Central Drugs Standard Control Organisation (CDSCO) in clearing high-risk medical devices, the parliamentary panel has recommended that approvals be decentralised to state authorities.

 

At present, states regulate the manufacturing of low-risk devices, while the central authority oversees imports and the manufacturing of high-risk devices.

 

“Centralisation with the Drug Controller General of India has created major bottlenecks and is the biggest hurdle to India emerging as a global medical devices manufacturing hub,” the report said.

 

It said that of 2,999 manufacturing and import applications processed, about 62 per cent were queried more than twice, while 253 import applications — including those with US Food and Drug Administration and CE (Conformité Européenne — French for ‘European Conformity’) certifications — remained pending for over 90 days.

 

These delays, the panel said, hurt India’s competitiveness against countries such as China, Vietnam, and Malaysia.

 

The committee also recommended setting up a dedicated facilitation cell within CDSCO to help domestic manufacturers navigate the Medical Devices Rules, 2017, and reduce delays caused by incomplete or delayed responses from applicants. 

Funding fault lines

• Ministry was allocated ₹75 cr for mission in BE for FY25. RE for the year fell to ₹50 cr
• While ₹50 cr was earmarked for the scheme in BE 26, the revised allocation for the year fell to nil
• Expenditure for FY26 remained nil till January 2026
• It received zero allocation in the Union Budget 2026-27