Experts in the medical equipments are of the view that India can emerge as an alternative destination to China in the field of medical equipment and devices manufacturing if the central government extends the right impetus and make necessary changes in its policy.

Engineering excellence, cost-effective labor, increasing emphasis on intellectual property rights and most importantly a fast growing domestic market makes large scale medical technology manufacturing a viable option for India now. Besides, India has the technical resources, production capability in terms of quality, cost and delivery to indigenously manufacture and market medical devices.

With input industries to medical technology sector like electronics, biotechnology, information technology and sheet metal fabrication booming in India, the research and production of medical devices and equipment should be encouraged in the country, Dr. G S K Velu, managing director, Trivitron Group of companies told Pharmabiz.

With multiple levies on Indian manufacturers like increased customs duty compared to finished goods import, excise duty and VAT (value added tax) make domestic manufacturing of medical devices and instruments financially unviable. Lack of clarity in regulations and absence of pricing norms is allowing bigger players to charge exorbitant prices for their imports.

By removing anomalies in customs duties, granting exemption of excise and VAT on domestic manufactured goods and providing capital grants and subsidies, the government can assist the indigenization initiative of this industry, he said. Velu is also the president of Association of Medical Devices and Suppliers of India.
Initially, the government imposed high custom duty on imported medical equipment making it difficult for private entrepreneurs to set up hospitals. But in post liberalization period, the duties have come down and some life saving medicines and equipments can be imported duty free. But this has lead to a reverse reaction as today over 90 per cent of the requirements in this industry are being imported making it one of the most import dependent industries in the country, Dr. Velu said.

In order to promote domestic medical device manufacturing industry, government should reconsider its taxing policies which are currently higher for the import of components of medical devices than the finished product itself. This creates a huge hindrance for the domestic manufactures and increases the primary cost of manufacturing in India, Dr. Velu added.