The Association of Indian Medical Device Industry (AiMeD) has expressed deep concern over the final guidelines for implementation of the provisions of the Public Procurement (Preference to Make in India) Order (PPO) with respect to public procurement of medical devices issued by DoP recently.
“Government of India has the intent but lacks boldness – half-hearted attempts will get half-hearted results. It is a clear case of a lost opportunity to promote indigenous manufacturing of medical devices to boost ‘Make in India’ initiative,” said Rajiv Nath, Forum Coordinator, AiMeD.
If lowest price of tender bid is imported then the Indian manufacturers meeting the criteria of domestic content has option to match lowest price and seek 50% of tender. If lowest is Indian, there are no added advantage of course, he added.
The DoP guidelines do not provide preferential pricing for Indian devices. There are no incentives on maintaining and improving quality, indigenous development and no penal action based disallowance to use exclusionary 3rd country regulatory approvals like US FDA in tenders.
AiMeD now suggests for Preferential Pricing for domestic manufacturers based on World Bank norms. The preference for ICMED/ISO Certified manufacturers will boost quality.
Preference for India certified manufacturers will give a fillip to indigenous development. There needs to be timely payment against government supplies. There is need for penal provision against hospitals that keep exclusionary compliance clause of US FDA certification as 3rd Country Regulatory approval.
World Bank has a clause to support domestic manufacturers by adding 15% to import CIF price of imported goods for the sake of bid comparison and thereafter the lowest price is winner. So if Indian manufacturer wins he will supply at his bid price, not at a higher price, said Nath.
By denying preferential pricing to genuine Indian manufacturers, the policy guidelines are not exactly encouraging. It is sad that genuine concerns and suggestions of domestic medical device manufacturers are being repeatedly sidelined, noted Nath.
DIPP/ DoP needs to do a study of gains made by any MSME (micro small and medium enterprise ) in winning tenders in past by matching L1 Pricing of imported Chinese products to win 20% of tender under the MSME Policy. If an Indian manufacturer finds it unsustainable to match L1 of lower priced Chinese imports to get 20% of the business as was earlier too possible then what is the use of this Policy to get 50% of the tender, queried Nath.
We can match prices of any country other than China as it has no global market economies but a subsidised state sponsored ecosystem. How can we compete with low priced imports from china with non-remunerative, non-sustainable pricing unless Indian government has supportive policies, Nath asked insisting India needs to follow the UN system of procurement based on sustainable costs and not based on L1 Lowest pricing that motivates some manufacturers to cut corners in regard to quality and service delivery of product and give poor image to Brand India.
Regretfully to compete with low priced Chinese imports that are flooding the market, there is no preferential pricing for Indian devices. World Bank provides for this, but our government is strangely shy despite Ministry of Finance permits the same under General Financial Rules.