The Confederation of Indian Pharmaceutical Industries (CIPI), a confederation of mostly small scale pharma units, will soon approach senior union health ministry officials to seek the ministry's intervention in implementing the Rs 560-crore pharmaceutical technology upgradation fund (PTUF). The Planning Commission had recently objected to the PTUF scheme and had asked the union chemicals ministry to revive the Credit Linked Capital Subsidy Scheme (CLCSS) instead.

"The PTUF is an important scheme for us and we will soon meet senior health ministry officials to impress upon them the need to implement the scheme," CIPI chairman TS Jaishankar said. The scheme is aimed to provide financial assistance to small and medium drug manufacturing units for the technological upgradation of their manufacturing facilities in compliance with the Good Manufacturing Practices (GMP).

The Planning Commission's objection to the PTUF scheme was on the ground that there is already a scheme CLCSS, launched by the Ministry of Small Scale Industries for the technology upgradation of small and medium units, and there is no need to launch another scheme for the same purpose. The CLCSS was discontinued by the Planning Commission from the current financial year due to lack of proper response from the industry.

But, the industry is of the opinion that the PTUF scheme is a much better scheme than the CLCSS. There were few takers for the CLCSS scheme due to several complex provisions which the SSI units found it difficult to follow. The chemicals ministry mooted the PTUF scheme after the industry's poor response to the CLCSS scheme.

The PTUF scheme was launched by the government for the benefit of thousands of pharma SSI units spread across the country. The objective of the scheme is to assist the SSI units in technological upgradation of their manufacturing facilities to comply with GMP as per the norms under Schedule M of Drugs & Cosmetics Act, 1945. Under the scheme, which has been lying idle for quite some time, the government proposes to reimburse 5 per cent point interest on the loans from the banks or financial institutions.

Thousands of small drug manufacturers in the country were eagerly looking forward for the launch of the scheme to upgrade their facilities to meet the Schedule M norms. Thousands of small drug manufacturers have already closed down their units after the introduction of Schedule M due to financial difficulties.

Now that the Planning Commission has taken objection, there is uncertainty on the future of this scheme, which the ministry otherwise was to finalise very soon. The scheme was under active consideration of the chemicals ministry for final approval after the National Productivity Council (NPC), which was assigned to work out some viable modalities to disburse the so-far-unutilized Rs 560 crore funds, submitted its reports some months back. The scheme was to be finalised and get approved by the Finance Ministry and the Planning Commission.