As the medical equipment industry in India is dependent on imports, manufacturers hope that the Budget would encourage indigenous production by bringing in a dedicated regulatory body and reducing customs duty on raw materials.

GSK Velu, Chairman and Managing Director, Trivitron Group of Companies, a manufacturer of medical equipment, said Indian medical devices industry, which accounts for about ₹40,000 crore, is 80 per cent import dependent. Until recently, there was no differentiation between manufacturers and distributors of medical devices as the import duty levied was the same.

Velu said, “reducing the duty on raw materials to 2.5 per cent and increasing the import duty on finished goods will encourage indigenous production.”

Regulatory body Rajiv Nath, Forum Coordinator – Association of Indian Medical Devices Industry (AIMED), said as there are no regulations pertaining to industry, it is governed by the regulatory law for Drugs and Cosmetics. This discourages investments in the area of medical devices as there is no framework to validate the credibility of products made in India, he added.

Nath said having an autonomous regulatory body that mandates third party accreditation for the equipment manufacturer will create higher international acceptance for Indian products.

Maruthachala Mandiram P Director – Srushty, a start-up in the medical equipment manufacturing space, said, “With lack of regulatory mechanism, corporate hospitals are reluctant to buy medical devices which are manufactured in India.”

Funding for Start-ups

Funding is another challenge for the start-ups as the industry is capital intensive and has long gestation period. “Many venture capitalists are apprehensive about investing in medical devices start-ups as it takes more than three years to get returns,” Mandiram said.

Siraj Dhanani, Founder and Chief Executive Officer, InnAccel, a medical technology start-up, said, there is a need to build an ecosystem that will support in-house design and production of medical devices.

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