IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

Yes

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
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Inception date: 01 Apr 2020 | Removal date: 31 Mar 2028

Production subsidy

On 21 March 2020, the Indian Union Cabinet of Ministers approved two schemes to promote domestic manufacturing of Key Starting Materials/Drug Intermediates and Active Pharmaceutical Ingredients. One scheme is for the development of common infrastructure facilities and the other to incentivize domestic production of certain drugs.

  • Production Linked Incentive (PLI) Scheme
    • Under the PLI scheme, a financial incentive will be provided to manufacturers of 53 critical bulk drugs on their incremental sales over the base year (2019-20) for a period of 6 years.
    • Of the 53 bulk drugs, 26 are fermentation-based bulk drugs and 27 are chemical synthesis based bulk drugs. The rate of incentive is fixed at 20% of incremental sales value for fermentation-based bulk drugs and 10% for chemical synthesis based bulk drugs
    • The corpus of the scheme is INR 6940 crore (~USD 920 million) approved for a period of 8 years.

The Indian financial year begins on 1 April and has been considered as the state for the above scheme as well.

* INR to USD as on 21 March 2020 - INR 75.42/USD

AFFECTED COUNTRIES

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AFFECTED SECTORS AND PRODUCTS

352 Pharmaceutical products

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