Budget 2022: Expectations of the Medical Devices Industry

Jatin Mahajan

The Indian MedTech and diagnostics industry has been driving the government’s initiatives like Aatmanirbhar Bharat and Ayushman Bharat. Keeping in mind the significance of the medical devices & diagnostics industry, we have the following recommendations for the Government of India for the forthcoming Budget 2022.

Zero custom duty on imported MedTech products – Zero custom duty rule on various MedTech products was implemented during the initial phases of the pandemic. This has led to uncontrolled dumping of non-standardised low-quality Chinese products in the Indian market. However, Indian manufacturers are still subject to duty structures and quality standards. This rule does not favour domestic production, and is irrationally skewed in favour of importers.

– Inverted duty structure– This long-highlighted anomaly is yet to be addressed. The duty on finished imported products is lower than imported raw material. It is exactly this reason which has made us dependent on imports and not self-reliant.

– Rationalisation of Trade Margins – MRP on all imported products must be capped at 4x of the landing price. Resorting to massive profiteering, importers sell their products at 10x – 20x of the landing price in India. This must be curbed.

– ICMED as the Umbrella Certification –ICMED certification must be established as a robust Indian mark equivalent to the likes of CE and FDA. This should be implemented for all domestic and imported devices. This will bring about standardisation and raise the quality of the medical devices available in the Indian market.

Also Read: Amendment of ‘inverted duty structure’

– Adequate Manufacturing Infrastructure – Development of Medical Devices manufacturing hubs and SEZ need to be accelerated. This will provide the right mix of common infrastructure, facilities, and subsidies for technological upgradation. This will drive sustainability, economies of scale, and boost growth.

Other critical aspects for accelerating the Make-in-India initiative includes– faster government permissions and single-window clearances; ensuring cost advantage over China; ease of doing business; adequate financing; competent infrastructure; soft loans with longer repayments.

Views expressed by Jatin Mahajan, Managing Director – J Mitra & Co, Joint Coordinator – IVD (AiMeD)

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