Baddi in the Solon district of Himachal Pradesh is emerging as the pharmaceutical industry capital of India. More than half of India's pharmaceutical production, mainly formulations, would originate from Himachal Pradesh in few years as 200 odd medium and large-scale units are coming up in and around Baddi.
The fortunes of Baddi began to change with the visit of the then Prime Minister to Uttranchal and Himachal Pradesh during March 29 and 31, 2002, where he announced tax and central excise concessions to attract investments to special category states.
The major attractions for investors included 100 per cent outright excise duty exemption for a period of ten years from the date of commencement of commercial production (the past budget stipulated it to industries starting on or before 31st March 2007), 100 per cent income tax exemption for an initial period of five years and thereafter 30 per cent for companies for a further period of five years, capital investment subsidy of 15 per cent on plant and machinery subject to a ceiling of Rs 30 lakhs, applicable also to existing units.
The schemes are also available for existing units going in for expansions. The identified thrust sectors included non-polluting pharma and herbal products. Besides, the State Government also announced a slew of attractive investment schemes, including single window clearance for projects.
The major investors at Baddi include Alkem Laboratories Ltd with a Rs 60- crore investment plan for a new formulations plant, Indoco Remedies with a Rs 25-crore tablets, creams and medicated toothpaste facility, Bangalore-based Bal Pharma with a Rs 20-crore tablets and capsuling facility and Unichem Labs with two new plants at an investment of Rs 40 crore and Rs 32 crore. Unichem is already operating a betalactum plant in Baddi. The Delhi-based Promed is investing Rs 25 crore and the Hyderabad-based Pulse Pharma with another Rs 6 crore facility. Morepan Laboratories, which started two units at Rs 60 crore and Rs 50 crore (bulk drug) about two years ago, is further developing a Rs 20 crore biotech research project with US collaboration.
Also, Chandigarh-based Ind-Swift Ltd. is setting up a Rs 50-crore formulation plant in Baddi, and same is the case with Dr.Reddy's Lab, Hyderabad which reached there very early.
Torrent's is setting up Rs 128-crore tablets, capsuling and oral liquid facility, aimed exclusively for the domestic market. Cipla plans Rs 40-crore project in Baddi. Nicholas Piramal is also thinking big about Baddi with two plants of Rs 70 crore each in two phases, first for tablets and capsules, and then injectibles. Panacea Biotech is investing Rs 30 crore in formulation plant.
Ailmil Pharmaceuticals is also constructing a Rs 10-crore Ayurvedic medicine facility with the same deadline for commissioning. Parentaral Drugs India Ltd's Rs 25-crore formulation plant is also getting ready. Charak Pharma is constructing a Rs 14-crore plant for herbal tablets and powder facility in Baddi. The Baroda-based Alembic Ltd is also constructing a new formulations manufacturing unit at Himachal Pradesh at Rs 30 crore. Zydus Cadila Healthcare Ltd also has plans to have a plant in Himachal Pradesh. The Chandigarh-based Surya Pharma already has a unit in Baddi. The dental care giant Colgate-Palmolive India Ltd. is investing in Rs 500 million toothpaste manufacturing plant at Baddi. Fem Care Pharma is also investing in Baddi. Already existing main players in Baddi include majors like Morepan, Dabur, Cadilla, Ozone Ayurvedics, Alkem, Shrinivas Gularath Laboratories Ltd., Indchemie Health Specialities, Gulfa Baddi, Abyss Pharma, etc.
Official sources aver Himachal is in the process of attracting investments to the tune of over Rs 4000 crore. Interestingly, the whole of Solon district had only 2800 odd units with an investment of a meager Rs 18418 lakhs, until a few months ago in the medium and large-scale industry sector.
All the viable projects are cleared within one to two months time, the files shuttling fast between the district collector, town and country planning department, the branch, deputy secretary, finance secretary, and up to the finance minister and the Chief Minister. Since there is a clause stipulating non-Himachalists cannot own more than 9000 sq.ft of land, the special clearance for most of the projects come directly from either the CM or FM, who personally process almost all the projects.
Other major points that make Baddi, about 45 kilometers from Chandigarh, a hot destination for pharma investors include easy accessibility to Delhi and Chandigarh, availability of good water, salubrious climate and hydro electric power cheaper at Rs 2.50 per unit. The companies will have to be concerned only with the availability of manpower and skilled professionals. At present there are only one or two pharmacy colleges in and around Chandigarh, which can act as feeding centres for pharma units.
Along with the pharma industry, other industries in Baddi are also thriving. All the available hotels in Baddi and Chandigarh are flooded with project managers and paraphernalia of pharma companies to finish the projects before deadline. If a two-bed room neat apartment was available for Rs 2000 per month two years ago, it costs more than Rs 7000 now in Baddi. If land was available very cheap until recently, mow it hovers around Rs 35 lakhs and above per acre.