The Gujarat Ayurved Aushadh Manufacturers Association (GAAMA) has urged the Union Ministry of Ayush for reconsideration of 12 per cent GST on Ayush medicines.

There are an estimated 8,000 ayurvedic manufacturers in India. Before the implementation of GST, 60-70% of these units were out of the excise limit as they had less than Rs.1.5 crore yearly turnover and they came under 4-5 per cent VAT structure. According to new GST structure, all the units now fall under the 12 per cent slab which will have an adverse impact on these units due to the increase in financial burden and may force many of them to shut down their units.

Vaidya Punarvasu Agnihotri, GAAMA secretary said, “we urge the government to consider Shastrokt or Proprietary Aushadhis used in treatment of various diseases like Tail, Ghrit, Avleh, Capsules, Tablets, Churna, Asav, Arisht, Syrup, etc under the 5% slab, and the rest (eg. FMCG, shampoos, etc.) under the slab which is appropriate according to the government. Ayurvedic tooth powder, hair oil (without synthetic oil), tooth paste, etc are daily needed products for our 125 crore population. We request the government to consider these products also under 0-5% GST slab”.

“The ayurvedic/traditional treatment system contributes only about 2% of the total pharma market in the country in comparison to the modern system of medicines. Having the same 12% slab for both will hinder our industry. Due to lack of enough financial support from the government, the industry is already underdeveloped in the country. The world, including well developed countries, recognizes the importance and effectiveness of this healing system,” he added.

Only 2-3% of ayurvedic units come under Rs.100+ crore turnover category. There is a huge sale/share of ayurvedic FMCG and cosmetic products (shampoos, soaps, cosmetics etc) apart from ayurvedic medicines under this category which makes the size of this industry look larger. The actual portion of ayurvedic aushadhis is smaller. Almost 80 per cent of raw materials used by the industry are farm or natural products, sustaining and supporting the farmers, villagers and tribal people directly or indirectly. Effect of 12 per cent% slab may hit the sale of ayurvedic products directly, which will affect them also, the GAAMA secretary said.

The processing of raw materials and manufacturing of medicines in the small scale units is time consuming and expensive due to lack of modernization and automation, increasing the production costs and making them costlier than synthetic medicines. This makes the treatment with traditional medicines more expensive to the common people. This cost factor drags common people away from ayurvedic medicines and hinder the progress of the industry, he further said.