The delay in assessment of SSI units requiring assistance for upgrading facilities in compliance with GMP norms has held up the launch of Rs 560-crore Pharmaceutical Technology Upgradation Fund Scheme (PTUFS) for which Rs 340 crore had already been earmarked during the 11th Plan.

Though a provision of Rs 11.80 crore was proposed for 2007-08, it could not be utilised because of the delay in launching the scheme, originally planned to be made effective from April 2007. The Planning Commission had in principle approved the scheme in December 2007 itself and Rs 340 crore was proposed during the current plan. Remaining Rs 220 crore was to be spent in the first two years of the 12th Plan, sources said.

The National Productivity Council (NPC) was entrusted to take up the assessment of SSI in February this year and asked to complete it in 60 days. However, it could not make much headway and would now tour the SSI clusters to finalise its recommendations.

The Planning Commission has also asked for data relating to a number of SSI pharma units which have availed credit linked capital subsidy scheme (CLCSS) for technology upgradation to become GMP compliant, before putting final stamp of approval on the scheme. Different pharma associations have been asked to intimate the number of SSI units who have availed the scheme. According to the office of Development Commissioner (SSI), only 65 drug units have been given the CLCSS assistance, with total subsidy amounting to Rs 217.44 lakhs so far, sources said.

The Centre expects that about 2000 pharma units would be benefited under the scheme and with each of them borrowing Rs 1 crore on average, the government share of reimbursement of 5 per cent point interest on loan during the five years period would be around Rs 560 crore.

According to the draft scheme, government would reimburse 5 per cent interest on the loans taken from scheduled banks and financial institutions and SIDBI would act as nodal agency. The scheme would be operational initially for two years and may be extended for another year. But the loan can be repaid for a maximum period of five years and interest reimbursement would be available during the period.

The total investment for technology upgradation should not exceed 25 per cent of the total investment in plant and machinery, as per the draft. The investment for upgradation can cover land and factory building including renovation and electrical installations, energy saving devices, effluent treatment plant, in-house R&D including pilot plant, information technology and total quality management.

"The assistance will be need-based. The maximum amount of loan shall not be exceeding Rs 1 crore,'' it said. The draft has also listed the equipments relevant for different sections of pharmaceutical units for upgradation. It would be updated from time to time on the basis of recommendations from a monitoring committee, the draft document said.