The medical equipment and devices industry is an ideal candidate for the Make in India mission. The Rs. 18,000 crore Indian MedTech industry is highly import-dependent, with imports contributing close to 75 percent. At present, there are 1000 domestic firms, that are primarily manufacturing low technology products.
It will require major initiative, maturity, and collaborative engagement between all the players - the government, stakeholders, and buyers. Consultants and associations will need to step forward and recommend India-specific regulatory, development, and marketing strategies. Innovative business models for public-private partnerships will need to be adopted, while setting up the right revenue-realization.
While labor costs are lower in the country, capital investment and productivity of labor are critical limiting factors. Combined with approval delays, this makes the manufacturing environment quite challenging for entrepreneurs. Access to low-cost capital through soft loans, subsidized land, and assured power & water supply, combined with tax incentives and single-window clearance will certainly build a stronger business case in India. The industry needs to get exposed to the evolving quality standards from countries that have had a head-start in innovations in this space. Delivering world-class quality is of paramount importance for the industry.
As a first step, the government would need to build the components ecosystem by attracting big global medical technology companies to India. This will enhance local capabilities, enable Indian companies to get access to components, and greatly enhance the local manufacturing capability. Once the ancillary industry is established, there will be significant value addition in finished medical equipment and devices. The process of setting up manufacturing facilities needs to be streamlined by designating medical technology hubs all over the country with the right infrastructure in place to support complex medical technology manufacturing.
Once this is set, Preferential Market Access Policy in medical equipment and devices can be brought into play. The Confederation of Indian Industry has submitted key recommendations to the Department of Pharmaceuticals with regard to this.