How to fix Indian pharma's Chinese import problem

Indian pharma's dependence on Chinese imports can be reduced only by developing a domestic ecosystem that boosts and supports drug manufacturers

A global phenomenon that the Covid-19 pandemic exposed was the world’s reliance on China for various manufactured goods and raw materials. For India, its dependence on its eastern neighbour for numerous goods—electronics and electricals, automobile components and even personal protective equipment (PPEs)—was a stark reminder of the country’s lack of manufacturing prowess.

One of the sectors in which this was acutely felt was the pharma industry, which imports almost 70 percent of its requirement of APIs (active pharmaceutical ingredient)—also known as bulk drugs, they are the active ingredient in medicines—from China. India imports APIs from the US (4 percent), Italy (3 percent) and Singapore and Hong Kong (2 percent each) as well. This, despite India contributing 20 percent of the world’s generic medicines in terms of volume, and supplying more than 60 percent of the globe’s demand for various vaccines and antiretroviral drugs. India meets 25 percent of the UK’s demand for medicines, and one in three pills consumed in the US. And yet, India’s import of APIs has only kept rising: It has increased by a CAGR of 8.3 percent between 2012 and 2019. 

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