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Saturday, Mar 02, 2002

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Industry & Economy - Pharmaceuticals


No healing touch for pharma

D. G. Shah

CONTRARY to expectation, the Budget has not met the long pending demands of the research-based pharmaceutical industry. Though the Government has acclaimed "pharmaceutical industry as the most important knowledge-based industry in the country", in terms of action to provide an enabling policy framework very little is done. Even on the issue of parity, the bias in favour of importer vis--vis local manufacturer of the "life-saving" medicines is not changed. The importer will pay only 5 per cent Basic Duty for a product which if manufactured locally, the local manufacturer will have to pay 16 per cent Excise Duty. And, it is noteworthy that the import duty is on the landed cost, whereas the excise duty is payable on the wholesale price.

Obviously, the pharmaceutical industry are a disappointed lot except for foreign companies that will benefit from the reduction in the corporate tax rate from 48 per cent to 40 per cent.

(The author is Secretary General, Indian Pharmaceutical Alliances.)

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