The Union chemicals ministry will take a final decision on the modalities for disbursing around Rs 600 crore Pharmaceutical Technology Upgradation Fund (PTUF). The fund has been literally lying idle for some time now as there was not much takers for the fund due to some unviable norms in disbursing the fund.
According to sources, senior officials in the chemicals ministry are meeting on May 30 to take a final decision on the matter. The ministry has asked the National Productivity Council (NPC), which is working out some viable modalities to disburse the fund, to submit a report before May 30.
The chemicals ministry, early this year, had assigned to NPC the task of finding some workable solution in disbursing the fund which was introduced by the government to financially assist the small scale pharma units for upgrading their facilities to meet the Schedule M norms. The NPC is in its last leg of touring different parts of the country where small scale pharma clusters are located. The NPC has already visited northern parts and is presently touring Indore before proceeding to Maharashtra.
PTUF scheme was launched by the government for the benefit of thousands of pharma SSI units spread across the country. The objective of the scheme is to assist the SSI units in technological upgradation of their manufacturing facility in compliance with the Good Manufacturing Practices (GMP) as per standards fixed by Union health ministry in Schedule M of Drugs and Cosmetics Rule, 1945. Under the scheme, the government proposes to reimburse 5 per cent point interest on the loans taken from the banks or financial institutions. SIDBI was named the nodal agency for the scheme.
Though there are several attractive features in the scheme, the rider of providing a collateral matching to that of the loan amount was proving to be major handicap for the small units. Even though the scheme was open for some time now, there were few takers to the scheme due to the collateral norms. The pharma units have been demanding the government to relax the norms related to the collateral so that more small scale units will be able to take advantage of the scheme to upgrade their units.