Aiming to reduce dependence of Indian pharma companies on China for the active pharmaceutical ingredients (APIs) and also to give a boost to Prime Minister Narendra Modi's 'Make in India' initiative, the department of pharmaceuticals (DoP) is giving final touches to a package under which both the government-owned and private pharma companies will be offered several incentives to produce APIs in the country.

The government's initiative in this regard comes in the backdrop of the recommendations made by the Katoch committee on APIs, which had submitted its report to the government in September this year. In its recommendation, the Katoch committee had made several sweeping recommendations to change to the present policy on APIs.

According to sources, the Katoch committee report was discussed threadbare at a meeting called by the Prime Minister's Office recently to review the status of imports of bulk drugs and chalk out a strategy to produce them in India. At present, India imports about 85 per cent of its bulk drugs from China. The meeting also considered a revival package for the API industry in India, based on the recommendations of the Katoch committee.

As part of the package, the government is contemplating revival of two sick public sector units involved in production of APIs, besides inviting private companies to set up manufacturing units in the country.
 
The Katoch committee, constituted by the DoP to formulate a long term policy and strategy for promoting domestic manufacture of APIs/bulk drugs in the country, had recommended revival of public sector units (PSUs) for starting the manufacture of selected and very essential critical drugs like penicillins, paracetamol etc.

As part of the package, the government will also support a cluster-based approach for the API industry under which fiscal benefits will be extended to create infrastructure with common facilities.

In its recommendation, the Katoch committee had also recommended establishment of large manufacturing zones (LMZs)/mega parks for APIs which will help eliminate India's dependence on China for APIs. India imported APIs worth $3.9 in 2014-15, of which China accounted for $3.3 billion.