India is the world's fourth largest pharmaceuticals producer with an 8% share of global production by volume and 1.5% share by value. The industry produces bulk drugs belonging to all major therapeutic groups requiring complicated manufacturing process and has also developed excellent Good Manufacturing Practices (GMP) compliant facilities for the production of different dosage forms. India is home to the largest number of pharmaceuticals plants (61) approved by the US FDA outside the US, and the country accounts for the largest number of annual drug filings with the USFDA Export growth over the last five years has been over 20%, with the US being the largest market. In biotechnology, India has already been identified as one of the emerging leaders in the Asia-Pacific region. Several Indian companies have already started producing biotechnology-based drugs for diseases such as cancer and diabetes. Here again, China can be a key competitor.
Given our acknowledged strengths in the pharma industry, it's imperative that we step up the momentum, particularly in manufacture and exports. In this context the importance of SEZs cannot be over emphasized, from the point of view of concentrating scarce management and infrastructure resources on an effective programme rather than spreading them over too thinly. The benefits of SEZs can be optimised through active linkage programmes, adequate social and environmental safeguards, and private sector involvement in their development. Other requisites for a successful SEZs such as excellent connectivity, efficient communication and power facilities and finally good social infra-structure need to be ensured.
The change that allocating large tracts of farm land for SEZs would be detrimental to farmers' interests is some what misplaced - for two reasons: one, as the pace of industrialization picks up, area under agriculture is bound to come down. Also, considering the country's total land area, the proportion allocated for SEZs, both already approved and in the works, is minuscule. The more pertinent issue that needs to be addressed is agriculture productivity, which is extremely poor in India. In any case, the commerce minister has since made it clear that prime agriculture land would not be allocated for SEZs. However, there can be no two opinions about timely and adequate compensation to farmers for land, of whatever kind, acquired for SEZs. Two, any possible misuse of land could be checked by making the approval process more stringent, with applicants providing sufficient proof that their intents are genuine. The onus for this is on various state governments; likewise, on ensuring flexibility in labour laws. If the size of SEZs, in terms of geographical area, is a concern, smaller, sector-specific SEZs can be encouraged to come up in central business districts, as already envisaged in the policy.
In sum, the Indian pharma/biotech industry stands to be well served by SEZs. They will boost manufacturing exports, attract much needed FDI increase foreign exchange earnings and create more jobs. It's possible that some corporates might be drawn to set up SEZs for tax benefits alone, some others might profit from misuse of allotted land. But then there are loop holes in any scheme. Overall the SEZs are sound in principle and, if well executed, could fetch considerable dividends over the long run.
Given our acknowledged strengths in the pharma industry, it's imperative that we step up the momentum, particularly in manufacture and exports. In this context the importance of SEZs cannot be over emphasized, from the point of view of concentrating scarce management and infrastructure resources on an effective programme rather than spreading them over too thinly. The benefits of SEZs can be optimised through active linkage programmes, adequate social and environmental safeguards, and private sector involvement in their development. Other requisites for a successful SEZs such as excellent connectivity, efficient communication and power facilities and finally good social infra-structure need to be ensured.
The change that allocating large tracts of farm land for SEZs would be detrimental to farmers' interests is some what misplaced - for two reasons: one, as the pace of industrialization picks up, area under agriculture is bound to come down. Also, considering the country's total land area, the proportion allocated for SEZs, both already approved and in the works, is minuscule. The more pertinent issue that needs to be addressed is agriculture productivity, which is extremely poor in India. In any case, the commerce minister has since made it clear that prime agriculture land would not be allocated for SEZs. However, there can be no two opinions about timely and adequate compensation to farmers for land, of whatever kind, acquired for SEZs. Two, any possible misuse of land could be checked by making the approval process more stringent, with applicants providing sufficient proof that their intents are genuine. The onus for this is on various state governments; likewise, on ensuring flexibility in labour laws. If the size of SEZs, in terms of geographical area, is a concern, smaller, sector-specific SEZs can be encouraged to come up in central business districts, as already envisaged in the policy.
In sum, the Indian pharma/biotech industry stands to be well served by SEZs. They will boost manufacturing exports, attract much needed FDI increase foreign exchange earnings and create more jobs. It's possible that some corporates might be drawn to set up SEZs for tax benefits alone, some others might profit from misuse of allotted land. But then there are loop holes in any scheme. Overall the SEZs are sound in principle and, if well executed, could fetch considerable dividends over the long run.
