The Pharma industry in the newly carved Andhra Pradesh is awaiting ‘Special status category state’ from central government so as to get a new boost for its growth in the state.
At present, the pharma sector in Andhra Pradesh is facing a lot of problems such as availability of quality power, lack of well developed affluent discharge facilities and head blocks from regulatory and environmental authorities for new clearance and expansions in the state. Moreover with the recent devastating Hudhud cyclone things have turned all the more worst for the industry. The cyclone alone had brought a loss of more than Rs.200 crore for the industry.
In fact after bifurcation, the pharma sector in Andhra Pradesh has become a considerably reduced sector with the major chunk of the industry’s base has remained in Telangana. Hyderabad and the surrounding districts of Ranga Reddy, Mahabubnagar, Medak and Nalgonda hold more than 500 major pharma companies in addition to thousands of smaller SMEs, while in Andhra Pradesh, altogether there are only about 150 pharma companies concentrated in coastal districts of Vijayanagaram, Srikakulam, Vizag and Nellore. Among all Vizag has the biggest cluster holding more than 50 per cent pharma companies.
Of late, pharma investors are looking to invest in the unexplored districts of Chittoor, Ananathapur, Vijayawada and Guntoor districts. According to industry sources, majority of the investors are looking for the Center’s decision to declare Andhra Pradesh as a special category state and if this happens hundreds and thousands of new investors will flood in AP. “Already, the industry in Telangana is facing severe power shortage and is incurring huge losses. The TS government has also officially declared two day power holiday for the industry, because of this situation most of them are looking to shift their base to alternative destinations. Andhra Pradesh could become the best option for many, but they are all awaiting for a special status category so that industry can benefit in terms of subsidies, tax exemptions and easy land availability in addition to availing other infrastructure facilities at affordable prices from the government,” said, Sudarshan Reddy, chariman of DSR labs.
Recently, the DSR Labs has invested about Rs.15 crore for its formulations unit in Chittoor district at Tirupathi. The company is expecting full-fledged production from January next year, informed the chairman.
The pharma industry in Telangana is already at a saturation level, while the sector in Andhra Pradesh has a huge void. To fill this void, the Chief Minister of AP, Nara Chandra Babu is leaving no stone unturned to attracting new investments in the state. As the AP government has already declared City of Vijayawada as future capital of the newly carved AP, many leading investors are buying land nearby the city and in the next 5-10 years, the pharma sector will be able to give a tough competition to Telangana state, revealed sources in the industries department of AP.