The central government has been taking steps and measures to promote research and development in the drugs and pharmaceutical sector in the country. During the last three years (2003-04, 2004-05 and 2005-06), it has invested about Rs 233 crore for promotion of R&D in drugs and pharmaceutical sector.

Some of the R&D programmes implemented by the Centre to boost R&D in drugs and pharmaceutical sector are Drugs & Pharmaceuticals Research Programme of Department of Science & Technology (DST), New Millennium Indian Technology Leadership Initiative (NMITLI) of Council of Scientific and Industrial Research (CSIR), Technology Promotion, Development and Utilization (TPDU) programme of Department of Scientific & Industrial Research (DSIR), Small Business Innovation Research Initiative (SBIRI) of Department of Biotechnology (DBT).

Other initiatives include offering Research Fellowships and human resource development and weighted tax deduction under Income Tax Act for drug R&D.

The Indian pharmaceutical industry is presently estimated to be worth about US$ 12 billion. It is growing at an average rate of 8-10 per cent on the domestic front. On the export front, the average growth rate is between 20-25 per cent per annum.