The business in laboratory chemicals and equipment in India is currently passing through a phase of consolidation. It is not merely the enhanced adherence to global norms and guidelines on good manufacturing and good laboratory practices that promote the activity in this segment. There is also a growing awareness across the pharmaceutical and allied sector that good practices on par with global standards are something inevitable for them to survive in a highly competent scenario.
Though both lab chemicals and equipment sectors are witnessing a spurt in demands, the activity is reflected more in the latter. ``With Indian pharma-biotech companies showing an increased awareness for the need for good quality lab infrastructure, it is boom time for the business,'' says Rajeev Nair, general manager, Lab Water Division, Millipore India, Bangalore.
Innovative firms like Millipore are finding the heightened awareness on GLP as a great time to come up with products having superior technology and competitive pricing. More customers implementing GLPs and equipping their facilities as per standards in the advanced world. Earlier, if the trend was limited only to the top few players and it is highly motivating to sees it percolate down to the small, medium players in the industry, he comments. The global market is currently estimated to be around $2.5 billion and growing at a rate of 25 per cent.
The analytical instruments industry also registered a moderate growth compared to previous year despite the increased imports. The imported equipment versus indigenous equipment ratio in the segment has further come down to 85%-15% from the 75%-25% during the nineties. The increasing dependency on the imports is due to the lack of interest to invest in instrumentation, infrastructure and manpower, says Dr Ashes Ganguly, founder secretary of Indian Analytical Instruments Association (IAIA).
``India is yet to become a significant global player. Globally we get the financial support for information technology, but hardly there is any investment in instrumentation and infrastructure, which are also of prime importance,'' he maintains.
However, analytical instrument makers fear that the recent floods in Gujarat and Maharashtra could affect the market, at least temporarily as the rains played havoc
on several of the facilities and infrastructure. Gujarat and Maharashtra are considered the backbone of Indian analytical industry.
Despite the dependency on imports, the solvents and reagents and lab related chemicals industry is also clearly on the move. Specialty and & fine chemicals industry market size in India is currently valued at US$860 million and is growing at a rate of 10-12 per cent annually. The industry has seen a lot of volatility, largely due to merger and acquisition activity in the international markets, which has spilled over to the MNC segment in the local market.
On the domestic front, with the reduction in tariffs, Indian companies with strong systems and organised operations have benefited in the liberal environment. Globally, the easing of GATT regulations by 2005 will mean free trade and greater opportunities. Companies with competitive advantages in the areas of high value-added chemicals, conforming with international quality standards, have translated this as a growth opportunity to establish a dominant presence in both international and domestic markets.
Specialty chemicals including those used in the laboratories for different purposes encompass a wide range of substances. Among them only few are domestically produced in India. Jubilant Organosys (formerly Vam Organics) is one of the largest speciality chemicals company in the country. It is the leading manufacturer of acetyl products, pyridines and pyridine derivatives, fine chemicals, additives and other chemicals.