In the backdrop of the shortage and price increase of pharmaceutical raw materials from China, the central government may soon put forward a project proposal to increase the production of active pharmaceutical ingredients (APIs) and intermediates in India to make the domestic industry self sustainable, it is learnt.

The proposal, expected to come out through the study report of the Prime Minister's Task Force, will address the current bottlenecks in the bulk drugs and intermediates manufacturing industry in the country. The proposal, which the industry expects to moot the public private partnership model to strengthen the pharma sector, will then go through a feasibility study under a major consultant company, according to Pharmexcil sources.

"A concept paper on the current drawbacks in the Indian pharma industry is being prepared and we expect the government to announce something interesting before the end of this year," Smitesh Shah, vice chairman, Pharmexcil and managing director, Calyx Chemicals and Pharmaceuticals Ltd told Pharmabiz.

"The proposal will go through a feasibility study with one of the five leading consulting companies in the country and we are expecting some sort of public private partnership to come up through the proposal," said Shah. He added that Pharmexcil has provided necessary inputs and views on the proposal to the government officials in earlier discussions.

The proposal would come out as the part of the study conducted by the Prime Minister's task force to analyse the bottlenecks for the Indian pharmaceutical industry to become a global major, according to P V Appaji, executive director, Pharmexcil. The taskforce, under the chairmanship of Rajiv Kher, joint secretary with Union Commerce Ministry, is expected to submit its report to the Prime Minister within the end of August.

"The taskforce has completed almost 99 per cent of the report and is expected to submit it to the ministry of commerce within the month end, with emphasis on the need to address issues in API manufacturing and pharma exports. The report will suggest a detailed project to be carved out and finalised with the support of Planning Commission and the formation of Department of Pharmaceuticals will hasten the government support for the industry in this regard," said Appaji.

According to industry sources, currently India relies on Chinese imports for almost 20 per cent of the APIs and nearly 70 per cent of the intermediates. However, the stringent environmental regulations imposed by the Chinese government prior to Beijing Olympics 2008 and the increase in crude oil price have resulted in shortage of raw material supplies from China to India. This situation lead the government officials and the industry to moot on the options to become self sustain in raw material production, according to industrial sources.