Commerce Ministry has suggested critical policy interventions and special efforts to increase the presence of Indian pharma industry in China and reversing the trend in active pharmaceutical ingredients (API) sector, as part of boosting the overall pharma exports from the country and achieve a target of 15.8 billion dollar by 2013-14.

“Interestingly, CAGR (compound annual growth rate) of pharma exports to China over the last five years has been recorded at 6.44 per cent. This is extremely embarrassing for the Indian industry. It is noteworthy that at one point of time in the recent past India produced more than 70 per cent of its bulk drugs. Today, it produces only 30 to 40 per cent. Most of its bulk drugs come from China. Thus, a large part of Indian exports is formulation of Chinese bulk drug. This is an extremely disappointing and critical aspect of Indian pharma industry,” according to a strategic paper by the Commerce Ministry.

“Action is required at two levels. First of all, critical policy interventions need to be made in the API sector for bringing back bulk drug manufacturing to India. This would require concerted government action over the next few years. Secondly, special efforts need to be made to increase India’s presence in China in the formulation sector. This could be negotiated as part of an understanding between India and China. India should also negotiate with China cooperation in the regulatory and enforcement area. This is an extremely sensitive area, therefore, cautious and calibrated approach would be required,” it said.

The paper also noted that with China’s domestic industry was growing at 10 per cent and India has an increasing opportunity. “There exists an opportunity for Indian exports of pharma products to China of at least US$ 2 billion per year. India would have to leverage its position as a key export market for China and negotiate preferential access to Chinese market involving the following: Faster registration of specific generic drugs and unique combinations which are available in India and not in China and can contribute to reducing China’s healthcare costs,” it said.

It also called for a period of exclusivity in China for such generic drugs to ensure a sustainable opportunity for India in the Chinese market. China should undertake buying missions to India to source these drugs from approved vendors, the ministry said.

Recently, Planning Commission deputy chairman Montek Singh Ahluwalia requested China to open up its markets to Indian pharma products. “I believe the Chinese side is aware of our market access concerns,” he said at the first Strategic Economic Dialogue (SED) between the two countries in Beijing.