Following the success of the trade exhibition in Chennai, the pharma professionals and industry captains in Tamil Nadu are gearing up to call on the state government to take favorable steps for setting up an Excise Free Zone (EFZ) for pharma industry in the state as, they feel, it is a potential tool for promoting industrial development and trade.

The EFZ area will not only provide a boost to the local manufacturing companies for their growth, but also help the state to emerge as an export hub, says A P Vaitheeswaran, chairman and managing director of Aeon Formulations, Chennai.

He said, though the previous UPA government at the centre was represented several times in this regard, all the requests were rejected by it. Now, the present Prime Minister is industry friendly and his government is supportive of industrial growth. So, there is chance for hope provided the state government takes the proper steps.

“A tax free zone for pharmaceutical industry is necessary in Tamil Nadu. It can be set up only with the support of the central government only, but the state government should take up appropriate steps for it. If such a facility is set up in a place not too far from the airport and sea port facilities, not only the pharma industry in Tami Nadu will benefit out it, but the industrial units from the neighboring states also gain advantages of it”, he said in a chat with Pharmabiz.

According to Vaitheeswaran one excise free zone can prevent the flow of manufacturers from south India to Baddy in Himachal Pradesh. Besides, a huge reduction in the MRP of the medicines can be achieved. Several of the Tamil Nadu pharma industrial units have their plants in Baddy. Because of high marketing expenses, the cost of medicines is increasing in addition to the doctors’ demand. So, the companies are opting for cost reduction measures.

He pointed out that the state government was keen on setting up a SEZ area, but the former UPA government stalled the project of the state. The excise free zone will encourage the industry to reduce the MRP of all medicines to a rate of 5 to 6 per cent. The savings can be transferred to the spending for medical marketing, thereby the companies can reduce the prices to benefit the customers.

On May 2, the Consortium of Indian Pharmaceutical Manufacturers and Marketers Association (CIPMMA) had passed a resolution in its 8th annual general body meeting (AGM) held in Pondicherry requesting the state government to take steps for SEZ. According to sources from TN IDMA, there are 450 manufacturing units in Tamil Nadu, out of which 30 per cent are exporters.