The Hindu Business Line : Medical kit sector rules out new investments

The import-dependent medical devices and diagnostics products industry has ruled out investment in indigenisation initiatives without Government's help and motivation.

Expressing concern over the increase in the customs duty rates (proposed in the Budget) on medical instruments, devices and clinical diagnostic products, the Managing Director of Metropolis Health Services and President of the Association of Medical Devices and Diagnostic Suppliers of India (AMDDS), Dr G.S.K. Velu, said the industry could ill-afford to invest in home-grown initiatives, because multinationals were trading their products here through 100 per cent trading subsidiaries.

According to him, the investment in technology and devices was more than 50 per cent of the cost of establishing a hospital or expanding an existing one. "The Government could make such investments affordable by keeping the levies low.

In the long run, extending certain incentives for investment in this space could motivate the indigenous manufacturers of such devices," suggested the AMDDS President and cited how China, in the last 15 years cut its import dependency on medical devices and diagnostic kits from 90 to 10 per cent

When asked if the common man would perceive a dip in the healthcare costs with the reduction in the duty structure, he said the equipment costs were factored and charged to the patient (in most cases) immaterial of the number of tests being done with the same equipment. "The cost is a multiplication of the number of tests and not the intricacy of the tests."