The pharma industry associations by and large welcomed the Union Budget presented in Parliament today by Finance Minister P Chidambaram. Industry associations like OPPI, IDMA, CIPI and SPIC wholeheartedly welcomed the budget as 'good and growth oriented'. However, associations like IPA termed the budget as 'disappointing'.
Terming the budget as progressive, IDMA president BN Singh said that the Finance Minister has reduced the excise duty from 16 to 8 per cent which is a welcome step and will help reduce the prices of medicines. "We have been trying for this reduction for a long time. It is also appreciable that the Finance Minister has given relief to the HIV drugs and life-saving drugs. As a whole it is a good budget", Singh said.
OPPI also welcomed the budget. OPPI director Homi Bhabha said, "The budget is quite satisfactory and initiatives taken by the Finance Minister are good. The reduction in excise duty will make medicines affordable".
Welcoming the budget, Confederation of Indian Pharmaceutical Industries (CIPI) chairman T S Jaishankar said, "The Pharma Industry is delighted with the Budget. It has brought cheers to the entire pharma industry by excise duty being reduced to 8 per cent from the present 16 per cent. This will benefit the consumers as well as the industry".
All essential medicines will be available to the common man and over all productivity will increase all over India. This Budget will nullify the imbalance of cost structure between excise free zones such as Himachal Pradesh and Uttaranchal against the rest of companies all over India. Over 3000 small scale industries in the pharma sector will now be in a position to revive their production, Jaishankar added.
Wholeheartedly welcoming the budget, SME Pharma Industries Confederation (SPIC) leader Jagdip Singh said, "The reduction of excise duty from 16 to 8 per cent is a good relief to the SSIs. The disparity which was magnified by levy of MRP-based excise duty stands reduced to half. We are extremely thankful to the Chemicals ministry for getting it done".
Reacting to the budget, SPIC vice-chairman Lalitkumar Jain said, "We are glad to see the cut in excise duty. We have won the half battle, after persistent efforts for two years. Our association has been waging a tireless battle to see it happen. Now all units across the country should not make a rush to the excise free zones. There is now that level-playing field we have been asking for long time. Now the next target is formation of Central Drug Authority and all associations should come together to oppose it".
Commenting on the Union Budget, M Narayana Reddy, president, Bulk Drug Manufacturers Association (BDMA), said, "The Finance Minister's decision to cut down the excise duty from the current16 per cent to 8 per cent is a good sign. However, as far as the bulk drug manufacturing industry is concerned it's not a good sign. The Finance Minister should have taken some steps to reduce the tax exemption disparity between various states".
However, there were some discordant notes among the pharma associations. Some associations representing large industries termed the budget as disappointing.
Terming the budget as a big disappointment, Indian Pharmaceutical Alliance (IPA) secretary general DG Shah said, "It is disappointing for the industry as there is nothing for it. The reduction in excise duty will only help the consumers. In fact, we have been looking for several measures to encourage R&D but nothing has been done".
Giving a guarded reaction, Federation of Indian Pharma Entrepreneurs (FIPE), an association representing units in the tax holiday zone of Baddi in Himachal Pradesh, spokesman BR Sikri said that the reduction of excise duty will adversely affect the industry in the tax holiday destinations like Baddi. "The government should have maintained status quo. It will adversely affect us", Sikri said.
Commenting on the budget Dr K.K Narayanan, president, ABLE said - "The weighed average deduction of 150 per cent on R&D that has been extended to seed production activities will provide relief to the seed companies of the agri-biotech sector. To an extent ABLE recommendations made to the Finance Minster early this month have been taken care of".