The union commerce ministry has finally granted sole responsibility of promoting exports of the entire range of allopathic and ayurvedic drugs to the newly formed Pharmexcil in the Foreign Trade Policy 2004-'07 announced yesterday.

Although formation of Pharmexcil was notified by the commerce ministry sometime back, drugs and ayurveda panels continued to remain with Chemexcil creating confusion among pharmaceutical and ayurvedic exporters with regard to their membership and RCMC certificates.

Now, the Appendix 27 of the Foreign Trade Procedures of the Policy has clarified the status and responsibilities of Pharmexcil by passing over the drugs and ayurvedic panels to it. With this, the role of Chemexcil is confined to products other than drugs and pharmaceuticals listed in categories like Dyes and Dye intermediates, Inorganic, Organic and Agro chemicals, Cosmetics and Toiletries, Castor oil and its derivatives and Agarbattis.

The Pharmexcil is to take care of Drugs and Pharmaceuticals including intermediaries, herbal, ayurvedic, unani and homeopathic medicines, Biotech and biological products, Diagnostics, surgicals, nutraceuticals, pharma industry related services, collaborative research, contract manufacturing and clinical trials and consultancy operations.

Responding to the policy directive, the Chemexcil has already registered its protest with the union commerce minister. It has also sent complaints to Director General of Foreign Trade (DGFT) and the Union Commerce Secretary against the "sudden decision" of the ministry to deprive Chemexcil of its "main" line of functioning. "The commerce ministry should have given our members sufficient time to face this situation. A phase out period should have been decided after due consultations with us. The pharma panel of Chemexcil has 2082 members while the newly formed pharmexcil has only 400 members. How can the ministry announce such a decision without consulting us," Satish Wagh, Chairman, Chemexcil, laments. "This unilateral action by the Ministry of Commerce will have serious ramifications on the entire pharmaceutical industry, particularly small scale and medium scale industries," he fears.

The policy announcement has come close on the heels of another directive from the zonal office of the DGFT, which had given rise to lot of confusion among the drug exporting community with regard to the status of the RCMC issued by the Chemexcil. As per the Trade Notice No 2. (Dated August 5, 2004) issued by the Zonal DGFT office, Mumbai, "many exporters are getting incentives like DEPBs / Advance Licenses etc., by enclosing RCMCs which do not seem to be having relevance to their main line of business. In certain cases, the earlier RCMCs of some exporters might have become irrelevant on formation of new Export Promotion Councils. All such exporters are required to obtain relevant RCMC to continue to avail benefits under Exim Policy."

The confusion caused by the Trade Notice among the members of the drugs panel of Chemexcil, came to an end only after the Chemexcil succeeded in making DGFT issue another Trade Notice (No 5 dated August 16, 2004) declaring that the previous Trade Notice No 2 has been "kept in abeyance till further communication." It is known that Chemexcil is now busy attempting to get some clarification from the Ministry with regard to the policy directive so as to check erosion of its members to the new council.

Meanwhile, the Pharmexcil has welcomed the government decision. The decision of the commerce ministry has put an end to the ambiguity with regard to the role of both the councils, D B Modi, chairman, Pharmexcil said. He appreciated the commerce ministry move and invited all drug exporters who are currently part of Chemexcil to become members of Pharmexcil. "All drug exporters who are members of Chemexcil can enroll themselves with Pharmexcil without paying any membership fees. They would be issued RCMC by Pharmexcil by just producing a proof of their payments made to Chemexcil," he added.

Reacting to the development, Dr P V Appaji, executive director, Pharmexcil said, "the members can assure prompt services on all related matters from Pharmexcil."