In a win-win situation for both the government and the industry, the government of India is inviting the pharmaceutical industry to launch healthcare initiatives in rural India with active government support. These initiatives will help the government to improve healthcare in the rural areas while the industry can increase the size of domestic market.

The Union Government is inviting partnership of industry with the state governments in various projects under the National Rural Health Mission (NRHM), through which the companies can adopt some villages or supply medicines to the remote villages. The penetration into rural market will play a crucial role for the industry to increase the size of domestic market amidst huge competition.

"The industry can play a vital role in supply of medicine, at least the essential drugs, in areas where poor people are living, and it is the social responsibility of a corporate to do this," said an official source.

In a recent FICCI meeting on Pharma, G S Sandhu, joint secretary, Dept of Chemicals and Petrochemicals said, "The industries are welcome to collaborate with the NRHM project for further augmentation of the project, and this will definitely benefit the companies to improve their access to rural market,".

Presently, only below 40 per cent of the population in India has access to modern medicine while the rest of the majority relies on traditional medicines. The ORG-IMS, in its recent study on pharmaceutical industry, suggested that the industry could check out current strategies in rural market and build up capability for penetration into more into this untapped potential for future growth.

"The companies have better opportunity to capture this vast unaddressed market, which will accelerate growth of the industry in future," said Shailesh Gadre, managing director, IMS Health India Pvt Ltd.

The Union government is planning to initiate a free national health insurance policy, Rashtriya Swasthya Bhima Yojana, from April 2008 for the population in rural area below poverty line under NRHM.