The gradual decline in the performance of SMEs (small and medium scale entrepreneurs) sector in Andhra Pradesh especially with regard to contributing their share in the formulation segment has become a matter of big concern among the industry leaders in the state.

Presently, the contribution of SMEs in the exports of formulations is slowly declining. As compared to Gujarat and Maharashtra, there are not many big names in the SME segment that are known for their contribution in the formulations segment from Andhra Pradesh, revealed Dr P V Appaji, director general (DG), Pharmexcil.

“Though Andhra Pradesh is a bulk drug capital of India, the state is lagging behind in formulations as there are not many SMEs from the state who can contribute for the exports of formulations. Only a handful of big companies like Dr Reddy’s, Aurobindo, Hetero and Natco are prominent among the formulations companies in the state. If SMEs can also contribute their share in the formulations then Andhra Pradesh will stand on the top both for the bulk drug and formulations segments,” said Appaji.

Expressing his concern over the declining production of formulations and other medical products from the SMEs sector in Andhra Pradesh, the DG is of the opinion that most of SMEs have suffered hugely due to frequent shifting of their bases from one state to the other in search of availing tax benefits and other concessions. Because of frequent shifting, most of the small capital SMEs have lost their valuable time and investment and at the same time they have dug themselves deep in to debts and could not sustain for long due to problems of improper organization and maintenance.

While if one look at the case of SMEs in Gujarat and Maharashtra, the SMEs sector is the major contributor in the formulation segment. Today Gujarat is fast moving in formulations exports. A large number of proposals for product expansion and new product registrations are being received by FDA in Gujarat from SMEs, while the case is totally different in case of Andhra Pradesh.

In Andhra Pradesh, the SMEs are facing restrictions from regulatory authorities especially with regard to pollution control and other related issues. Though some of the issues have been solved, the industry leaders feel that the government should look in to the matter and should come out with some liberal and encouraging signs so that the state will attract more new investments in the SMEs segment and regain its lost glory.