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 A
guide on Indian economic scenario with relevant trade statistics and
a directory of Indian businesses, manufacturers, exporters, and
traders. |
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Drugs & Pharmaceuticals
Trade Policy
Most of the items under drugs and pharmaceuticals products are falling under HS code 30. They can be imported freely by
paying the specified custom duties. In few cases the imports are subject to Wild Life (Protection) Act, 1971 and CITES.
Industry Policy
Industries under drugs and pharmaceuticals have to obtain an industrial licence to manufacture, since it falls under Annexure
II which includes the list of industries for which industrial licensing is compulsory under Industries (Development &
Regulation) Act, 1951.
Industrial undertakings are free to select the location of a project.
Entrepreneurs are required to obtain Statutory clearances relating to Pollution Control and Environment for setting up an
industrial project. In respect of bulk drugs and pharmaceuticals, pesticides etc. environmental clearance needs to be obtained
from the Ministry of Environment, Government of India. Items reserved for the small scale sector with investment of less than
Rs. 10 million was also exempt from obtaining environmental clearance from the Central Government.
FDI up to 100 per cent is permitted on the automatic route for manufacture of drugs and pharmaceutical, provided the activity
does not attract compulsory licensing or involve use of recombinant DNA technology, and specific cell / tissue targeted
formulations.
FDI proposals for the manufacture of licensable drugs and pharmaceuticals and bulk drugs produced by recombinant DNA
technology, and specific cell / tissue targeted formulations will require prior Government approval.
100 per cent Export Oriented Units (EOUs) and units in the Export Processing Zones (EPZs)/Special Economic Zones(SEZs), enjoy
a package of incentives and facilities, which include duty free imports of all types of capital goods, raw material, and
consumables in addition to tax holidays against export.
Tariff-non-tariff Policy
Maximum custom duty on any item falling under the code 30 is 56.83 per cent. This includes 30 per cent basic duty, 16 per
cent additional duty and 4 per cent special additional duty. A lower 20 per cent basic duty is imposed if the imports are from
preference areas. There are many items where additional duty is nil. A total 27 restricted items are there under the code 30
which require import licence.
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