Gujarat has witnessed developments in all industrial sectors in the last few years. Not just pharmaceutical manufacturing, the state has ventured into setting up of medical devices manufacturing hub, petrochemicals, bio-pharmaceuticals etc and has encouraged the small and medium scale entrepreneurs in a big way apart from the large scale multi-national players. While on the other hand, the pharmaceutical segment in erstwhile Andhra Pradesh (now Telangana and Andhra state), the industry has seen many ups and downs since 1990’s.
Though the bulk drug industry has flourished and well established its base in Hyderabad and surrounding districts in Telangana and Vizag in Andhra Pradesh in the initial days, the later period from 1996 to 2011 had seen many fluctuations. Most important among this is the ban on expansion of new units in Hyderabad due to stringent environmental regulations. Secondly, lack of government support and slow pace of licensing has lead many entrepreneurs to look out for alternative destinations like Baddi in Himachal Pradesh and Gujarat.
The government’s in these states doled out huge incentives for the new industries and encouraged them with easy regulations. In fact during 1996 to 2009 more than 60 pharma manufacturing units have migrated from Andhra Pradesh to Gujarat and Baddi. “Gujarat has developed a very good pharmaceutical industrial platform. The state has huge encouragement for the small and medium scale industries. In fact, after bifurcation of AP, Gujarat has taken second place in the exports and it continues to attract new investors with its easy and favorable regulatory system,” opined Dr. P.V. Appaji, Director General of Pharmexcil.
Accounting for 16 per cent of the country's total industrial output and 18 per cent of the country's total investment, Gujarat is one of the most industrialized states in the country. Gujarat has emerged as the SEZ capital of India based on land area, with 51 sanctions, encompassing 16,500 hectares of land. Currently there are 3415 licensed drug manufacturing firms in Gujarat contributing more than 33 per cent of India’s total pharmaceutical turnover.
Recently Gujarat has established a medical device manufacturing hub by setting up more than 135 units accounting to 53 per cent of total medical devices manufactured in India. About 40 per cent of India’s machinery for pharma sector is manufactured in Gujarat and contributes 28 per cent of India’s pharmaceutical exports. 35 per cent to India’s diagnostic reagents and 78 per cent of cardiac stents are manufactured in Gujarat.
Over the years, the industry has developed strong linkages with related sectors and industries such as chemicals, pharma machinery, information technology, etc. The state houses several established companies such as Torrent Pharma, Zydus Cadila, Alembic, SunPharma, Claris, Intas Pharmaceuticals and Dishman Pharmaceuticals, which have operations in the world’s major pharma markets. Over the last few years, Gujarat’s contribution in the growth of India’s economy is significant. As per a report, Gujarat’s industrial model is declared as a rapid rollout model and it has been replicated in 13 states across India.
With Gujarat taking over AP and TS in many respects, the pharmaceutical industrial scenario in Telangana and Andhra Pradesh is in a wait and see mode and gauging the government’s role in persuading the industry. However, after bifurcation, many experts are of the view that opportunities for expansions and new establishments has doubled in both the states with an increased competitive spirit among AP and TS governments. In both the sides, the governments have overhauled the industrial polices and leaving no stones unturned to attract the industries towards their states.
When asked how they viewed the industrial scenario in Gujarat compared to Telangana, Narayan Reddy, MD Virchow and ex-president of BDMA says, “Of course Gujarat has a well established pharmaceutical industrial base and the regulatory system is also encouraging the SMEs more. However we need not have to move to Gujarat rather we can explore the new areas in the remnant Andhra Pradesh. Vizag is one of the biggest destinations for the pharmaceutical industry. The state government of AP has planned to set up three industrial clusters one each in Rayalaseema, Costal Andhra and North Andhra regions.”
Even in Telangana state, the state government had pro-actively come forward to allocate more than 15,000 acres of land for establishing an integrated pharma city on the lines of international standards. Though the industrial sector is confined to four districts of Hyderabad, Ranga Reddy, Mahabubnagar and Medak, the government is now chalking out plans to develop pharma clusters in other regions as well. “Though the TS government has come out with pro-active measures to encourage the industry, it needs to do more in terms of easing out regulatory aspects. Particularly the environmental issues are concerning the industry very much. However there are more opportunities in Andhra Pradesh and Telangana for the sector to expand and establish research institutions,” says Narayan Re ddy.
Experts view that if Andhra Pradesh and Telangana governments ease out their regulations and come out with some more encouraging incentives on the lines of Gujarat , definitely the pharma manufacturing and medical devices manufacturing will flourish and in the coming days both AP and TS with their past experiences, can grow faster and can equally contribute to the nation’s growth .