Can the Indian pharmaceutical industry decouple from China?

In India, any decoupling from China must be strategic, require sloth policy support and pace-based localization, the article saysTemporary or reactive decoupling may disrupt the production of a variety of drugs in India, as these raw materials come from Chinathe following is the main story of the article:background of "decoupling from China"India is increasingly demanding a boycott of trade with China because of recent political tensions between the two countriesHowever, this possible move has drawn the attention of India's pharmaceutical industry, as well as the global dependence on Indian drug supplieswhen production is organized through global supply chains, the costs of boycotting or banning trade are particularly high, as is the pharmaceutical industryAlthough India is the world's third-largest producer of finished medicines, it relies heavily on China to supply the supply of API, a key ingredient in the production of drugsAn estimated 70 per cent of the API for the Pharmaceutical Industry in India is from ChinaFor certain medications, such as paracetamol and ibuprofen, this dependence is almost 100%India's control of the environment and competition with China have exacerbated this dependence on imports because of higher production and lower costs in ChinaAs a result, according to Pharmscil, the Indian pharmaceutical industry has revenues of $40 billion in the 2018-19 fiscal year, and restricting or banning imports of API will cause significant damage to the industrythe impact of "decoupling from China"prospects are particularly concerned by potential patientsIndia's annual exports of drugs are close to $20 billion, and a severe contraction in production will affect access to medicines in India and around the worldThe impact is particularly severe in low- and middle-income countries, which are increasingly dependent on India for affordable medicinesIn fact, in many African countries, India provides nearly 50 per cent of the drugs in value terms, or even a higher percentage in quantitative terms some in India are trying to justify a trade boycott of China, pointing out that the indian pharmaceutical industry's transition from a foreign-dominated industry to an Industry controlled by Indian companies has begun Indeed, India's share of foreign TNCs has fallen sharply from 80-90 per cent in 1970 to 50 per cent in the early 1980s and now to 23 per cent In addition, India's drug prices have fallen from the highest in the world to the lowest However, India's pharmaceutical industry did not develop through a sudden decoupling, a complete boycott or a ban on imports from foreign multinationals The Indian Patent Act of 1970, which eliminates the protection of patent rights for pharmaceutical products, has been praised for promoting the development of Indian industry India also benefited from the Foreign Exchange Administration Act of 1973 (FERA) and the subsequent New Medicines Policy (1978), which restricted, but did not prohibit, the activities of foreign transnational corporations in India As a result, a series of policy initiatives have succeeded in tilting the balance towards companies that favour Indian ownership China and the global pharmaceutical industry in the early stages of the COVID-19 pandemic many fear that China's supply of raw materials to India will decline as a result of China's blockade Although these concerns have not yet been realized, the Indian government has taken steps to promote more API production in the country In March, the government announced a 30 billion rupee investment in the development of three API parks and Rs 69.4 billion over the next eight years for 53 API manufacturers Forward-looking plans to increase domestic production of API and reduce dependence on China are understandable and sensible policy objectives Despite the relative decline in recent decades, India has a stronger starting point than most, given the persistence of production capacity for certain SPEs For example, Indian companies have the capacity to produce COVID-19 therapeutic drugs, including Remdesivir other countries are also seeking to reduce their dependence on China, especially the United States There have been concerns about the health-safety implications of such dependence, including the possibility of China restricting its drug exports during the crisis In May, the Trump administration announced a $354 million contract with new company, Phlow Corp., to produce generic and api- drugs As a result, the United States is also seeking greater self-reliance, but this has not been immediately resisted In fact, even in the context of the Sino-US trade war, the United States has excluded drugs and some related products from tariff increases reduce its dependence on China will not be easy In India, any decoupling from China must be strategic, requires a lot of policy support, and is to be localized in a rhythmic manner Temporary or reactive decoupling may disrupt the production of multiple drugs because these raw materials come from China A british study recently found that the steroid-like dexamethasone can significantly improve the survival rate of COVID-19, which is a well-known example Other medications include painkillers such as paracetamol and ibuprofen, as well as antibiotics such as penicillin , therefore, in the short term, a boycott or ban would be counterproductive to Indian industry and would also affect the access of Indian nationals and other countries to much-needed medicines In the long run, reducing reliance on China also needs to be strategically cautious Ref: Reducing dependence on China will be for India's pharmaceutical industry, but it it must be strategic Rory Horner Updated: July 4, 2020, The Indian Express