Pharmaceutical companies harbouring huge expectations from Chidambaram’s BudgetFebruary 15th, 2008 - 6:48 pm ICT by admin
Ahmedabad, Feb.15 (ANI): Pharmaceutical companies are harbouring huge expectations from Finance Minister P. Chidambaram when he presents the Union Budget 2008-09 at the end of the month.
Starting virtually from scratch, the pharmaceutical industry in India has over the last 30 years evolved into a world leader in producing high quality drugs with the lowest cost of production, and now is ranked fourth globally in terms of volume and 13th in terms of value of production.
Despite having emerged as one of the major sectors of Indian economy, pharmaceuticals is still described as a sunrise industry.
“If the medicine excise duty is removed 100 percent from all the medicines that will be the biggest benefit to Indian communities and Indian people will remember P.Chidambaram forever. My second request to the finance minister is to give adamant upto 60 percent instead of 42.5 percent. If the government is sincere and looking for the benefit for pharma industries they are very much in trouble the excise duty abetment should be free from 42.5 to 60 percent and pharma industries can survive,”said Dipak Padiya, Managing Director, Osho Pharma Private, Limited.
The industry claims that the reduction of excise duty by half (from 16 to 8 percent) would facilitate availability of cheaper medicines in the market.
The pharma sector in Gujarat believes that the pattern in Jammu and Kashmir, Himachal Pradesh and Sikkim are more convenient than in Gujarat. The small-scale pharma units are demanding to increase abatement to 45 percent to compensate the higher excise duty, as the industry has to pay on tax included in maximum retail price (MRP).
The small-scale pharma units already having benefited from the increase in exemption limit are worried of competing with large-scale industries.
The leading pharmaceutical companies want long-term initiatives by the government for further growth of India’s pharmaceutical industry.
“Government must recognize the role of pharmaceutical company for the economic development of the country. We must realize that pharmaceutical industry touches the life of people and therefore, we must see it beyond economic development. Thus we need some fundamental, strategic long term initiatives being offered in the budget this time,” said Sushil Handa, Managing Director of Claris Lifesciences Limited, a pharmaceutical company.
Research and development spending in the pharmaceutical sector in India, despite having grown in recent years, is 2 percent of total sales which is very less in comparison to developed nations. The pharma industry feels that tax concessions and other measures would allow it to spend more on research that would not only help the industry but would also benefit the common man. (ANI)