India's pharmaceutical and healthcare sectors are poised for significant growth, with the government unveiling a series of key initiatives aimed at boosting manufacturing, research and development (R&D), and the overall competitiveness of the industry. A recent report by Centrum after a three-day roadshow with pharma and healthcare experts highlights these measures that are set to strengthen India's position in the global healthcare market.

Key Government Initiatives Driving Growth in Pharma and Healthcare

Several government schemes are central to the anticipated growth of the Indian pharmaceutical and healthcare sectors:

1. Production-Linked Incentive (PLI) Scheme: The PLI scheme is designed to encourage domestic manufacturing and enhance resilience against external supply chain shocks. By offering incentives for the local production of pharmaceutical products, the scheme aims to reduce India’s dependency on imports and make the country a manufacturing hub for high-quality drugs.

2. Bulk Drug Parks Initiative: The Bulk Drug Parks initiative is another crucial government measure aimed at promoting the domestic production of essential drugs. With an allocation of US$ 117.8 million (Rs. 1,000 crore) for each park, this initiative will provide up to 90% financial support for eligible projects in states like Himachal Pradesh. The aim is to reduce manufacturing costs, increase industry competitiveness, and ensure a steady supply of critical raw materials for pharmaceutical production.

3. Promotion of Research & Innovation in Pharma-MedTech (PRIP) Scheme: The PRIP scheme is focused on enhancing research and development (R&D) in the pharma and MedTech sectors. With a budget of US$ 82.5 million (Rs. 700 crore), this initiative will support the establishment of Centres of Excellence at the National Institute of Pharmaceutical Education and Research (NIPER), as well as provide funding for private-sector research. This is expected to accelerate innovation in critical areas such as MedTech devices and pharmaceutical technologies.

Rising Focus on AYUSH Sector

In addition to supporting conventional pharmaceutical industries, the Indian government is also placing a strong emphasis on the AYUSH sector—covering Ayurveda, Yoga, Naturopathy, Unani, Siddha, and Homeopathy—which has experienced rapid growth over the past decade. From a market size of under US$ 3 billion (Rs. 25,464 crore) in 2014, the AYUSH sector has grown to US$ 23.3 billion (Rs. 1,97,770 crore) in 2022, reflecting a compound annual growth rate (CAGR) of 17%. This expansion is driven by increasing consumer interest in alternative medicine and wellness practices, both domestically and internationally.

India’s Projected Healthcare Spending and Economic Impact

The government’s initiatives are expected to drive a surge in India’s healthcare sector, which is projected to witness increased healthcare spending from 1.3% to 3% of GDP. This is a significant leap that aligns with the government's broader vision of transforming India into a global healthcare hub.

Conclusion

India’s pharma and healthcare sectors are on the cusp of a transformative period, largely due to the government's strategic initiatives aimed at bolstering domestic manufacturing, advancing research and innovation, and fostering the growth of alternative healthcare practices. These efforts are expected to increase global investments in India’s pharmaceutical industry and make the country a leading player in the global healthcare landscape.

The government's commitment to promoting sectors such as MedTech, AYUSH, and pharmaceuticals will lead to enhanced infrastructure, research capacity, and product innovation, creating an environment ripe for business growth and global partnerships.

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