India is likely to sign an agreement with Germany on mutual recognition of Good Manufacturing Practices (GMP) certification for drug manufacturing units. A high level delegation is currently on a visit to Germany to work out the details of the agreement.

According to chemicals ministry sources, the mutual recognition agreement for GMP standards is almost certain, as it was Germany that initiated the discussions. "The demand came from them and we are confident of having Indian GMP certification automatically recognized by Germany soon", officials said.

A mutual recognition can be of immense help to the increasing number of Indian generic drug manufacturers who are targeting German market in a big way. The mutual recognition will also help India to seal similar agreements with other European countries.

According to the latest figures of the Directorate General of Commercial Intelligence and Statistics (DGCIS), the exports to Germany had shown 14 per cent growth during April-July 2006 as compared to the same period the previous year. It stood at Rs 7, 966.18 crore as against Rs 6,960.47 crore in April-July 2005. The quantity of pharmaceutical and medicinal products that were exported during the period was Rs 399.05 crore. It was Rs 354.67 crore for the period in 2005.

The import of drugs and pharmaceuticals also showed a slight growth during April-July period this year. It was Rs 107.25 crore in 2006 and Rs 92.13 crore last year.

Germany is known to be the third biggest pharmaceutical market after USA and Japan. While Indian pharmaceutical companies have already established their presence in the US, they are in the process of entering Japanese market in a significant manner. Ministry sources informed that the generic space in Japan is increasing thereby giving hope to Indian pharmaceutical industry. With the mutual recognition, entry to German market would also become smooth.