The Association of Pharmaceutical Manufacturers & Entrepreneurs of Haryana (affiliated to SME Pharma Industries Confederation) has demanded to the central government to impose central excise duty on contract manufacturing in the excise free zones of Himachal Pradesh and Uttarakhand to reduce the disparity between the excise free zones and the non-excise fee zones. Incidentally, Haryana is one of the worst affected states due to the introduction of excise free zones in the country way back in 2002 by the Vajpayee-led BJP government at the Centre.

In a memorandum submitted to Union Urban Poverty Alleviation minister Kumari Selja, who is the only representative in the Union council of ministers from Haryana, the Haryana pharma manufacturers said that though finance minister Pranab Mukherjee has done justice to the pharma industry by retaining the excise duty at 4 per cent, some other steps also have to be taken to reduce the disparity between the excise free zones and the non-excise fee zones in the country.

“Central excise may be levied on contract manufacturing in Excise Free Zones (EFZ) of HP/UK so that thousands of traders & doctors who are sourcing medicines with high MRP from there are checked and government gets revenue,” the memorandum said.

The Haryana pharma manufacturers also demanded to increase the central excise exemption limit for SSIs pharma from the existing Rs 1.5 crore to Rs 5 crore. “Presently, central excise exemption on SSI is Rs.1.5 crore for all types of industries. In case of pharma it may be increased to Rs.5 crores as pharma cannot be bracketed with other industry which is neither regulated nor under price control,” the memorandum said.

The Haryana pharma manufacturers also demanded to increase the abatement from the existing 35 per cent to 60 per cent. “While calculating excise duty, abatement of 60 per cent should be stipulated instead of 35 per cent allowed presently, so as to remove anomalies of MRP-based excise,” it said.