With the general elections nearing the final stages and the different ministries getting ready with files that demand immediate attention of the new government, hopes as well as apprehensions have started creeping into the industry segments including pharmaceuticals.
As in the case of other ministries, pharmaceutical, commerce, and health departments have also started taking inputs from the industry on the different policy matters and steps to be taken by the new government. Cabinet secretariat has already directed the ministries to prepare files in this regard as the new government will not have much time for presenting the regular budget, sources said.
Sources said the pharmaceutical department is keen to revive a number of files including the pending pharmaceutical policy, package for IDPL, and PTUF scheme for the consideration of the new government, among other things. The health ministry is also looking to take up a number of measures including the restructuring and revival of the three public sector vaccine units and the financial package for the same. The respective ministries are expected to brief and make presentations as soon the new ministers would be in power. The departments, hence, are working to collect figures, facts and details on the pending policy matters. Besides, the departments are also working on the pending bills including that of central drug authority formation.
On the positive side, the industry associations have started submitting their wish-lists for the new government. FICCI, in a recent representation to the Finance Ministry, has urged against phasing out of tax benefits.
"The (new) government should not only continue, strengthen fiscal incentives and introduce new ones as and when economically warranted, especially for sunrise industries and undertakings engaged in infrastructure and other crucial sectors," it said.
"What is causing concern is that over the last two years the government has been engaged in reviewing and phasing out tax exemptions and incentives largely owing to its feeling that these are costing the exchequer substantially," it stated.
The commerce ministry also held interactions with the industry and the Director General Foreign Trade (DGFT) has prepared some recommendations already for the new government. DGFT is considering simplification in export related procedures. At present, only three export incentive schemes-DEPB, EPCG and Advance Licensing, are included under the Electronic Data Interchange (EID). However, all export promotion schemes are likely to be included in the EID-enabled platform to reduce transaction cost. There could also be simplification of documentation for service tax refund, which is quite tedious at present.
But on the flip side, there is a growing argument in some quarters about rolling back the excise duty which was slashed to 4 per cent across the board as part of the stimulus package. The pharma industry will be one of the victims, if such a measure will be considered.