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Domestic medical devices units in trouble, seek special package in budget for survival
Joseph Alexander, New Delhi | Thursday, January 24, 2008, 08:00 Hrs  [IST]

The domestic medical devices manufacturers, placed in a struggling phase like the pharma industry 20 years ago, is keenly looking for some morale-boosting schemes like tax-free medical technology parks in the forthcoming budget to pitch itself on a level-playing field with the international players.

``The current policy by the Government is completely lopsided. Or there is no clear policy at all. We don't have any incentives from the government to boost the local manufacturers,'' said Dr G S K Velu, president of the Association of Medical Devices and Suppliers of India (AMDSI).

There should be a clear distinction between the finished products and the raw materials. The current anomalies should be removed to help the indigenous manufacturers and bring down the prices of devices in the market, he told Pharmabiz.

Currently, the medical devices market is estimated to be worth around Rs 12,000 crore and out of this, Rs 10,000 crore worth devices are being imported. If the medical equipments could be manufactured in the country, their prices would come down by 50 per cent, it is said.

``Like the software technology parks, medical technology parks with special perks like excise duty exemptions and capital incentives should be introduced,'' Dr Velu said.

At present, the manufacturers were facing a hostile import duty structure with raw materials being charged with very high duty rates while the finished devices attracted comparatively lesser duties. This has always forced the players to be mere suppliers of foreign-made devices rather than manufacturers.

Besides, it was also pointed out that 90 per cent of the devices imported were made as per the requirements of people in US or those in Europe and the Indian customers were forced to use the same.

The Association has also urged the government to set up a separate regulatory mechanism for the devices as those in the drug regulatory authorities were not qualified enough to monitor the segment. Moreover, the players were left in the lurch as there were no clear policies on which ministry should be in-charge of the sector. New devices come under the new drug category controlled by the Health Ministry, while as an applied science, the quality aspects should be controlled by the DST.

Besides, the local players also are accusing the multinationals, who control the market, of lobbying to retard the local manufacturing segment. The AMDSI is in talks with the Assocham to garner more support from the industry to press their demands.

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