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Serum Institute, Bharat Biotech to get ₹4,500-cr govt ‘advance’

Our Bureau New Delhi | Updated on April 19, 2021

The Finance Ministry has relaxed the General Financial Rules to provide low-cost funds   -  AP

Vaccine-makers have been seeking financial support for R&D investment

Vaccine makers Serum Institute of India and Bharat Biotech will get approximately ₹4,500 crore as advance payment without any bank guarantee from the government. Both companies supply the two vaccines, Covishield and Covaxin, that are being rolled-out in the country.

“We have relaxed General Financial Rules (GFR) which will enable advance payment without any bank guarantee. This will bring down the cost of fund,” a senior government official told BusinessLine.

Serum Institute will get approximately ₹3,000 crore while Bharat Biotech will get around ₹1,500 crore. However, the official did not explain the amount will cover how many vaccines to be supplied.

Vaccine manufacturers have been seeking financial support from the government considering investment made in R&D and huge capacity addition. As there was no provision for advance payment in such situations in GFR, initially government was considering assisting these companies by getting support from multilateral agencies. Since this is a long process, it is believed that Finance Ministry decided to amend GFR to provide low-cost funds immediately, so that more and more supply of vaccines can be insured.

Seeking Centre’s support

Recently, Serum Chief Adar Poonawalla had urged the government to financially support their expansion plans. Serum expects to make 100 million doses per month by May-June (from 65 million odd now). Bharat Biotech has not been as vocal on its financial requirements, but the aid will help up its production.

The government’s latest move comes close on the heels of it roping in three public sector units to make Bharat Biotech’s Covaxin. Bharat Biotech had been given ₹65 crore as part of that plan as well, and the aim was to touch 10 crore doses (from one crore now) by September.

Published on April 19, 2021

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