India's pharmaceutical supply chain remains heavily dependent on imports from China, according to a report by NITI Aayog. The dependency poses a significant vulnerability for the country, which is a major global supplier of affordable generic medicines.
India's Role in Global Generic Drug Supply
India supplies approximately 50% of Africa's generic medicine needs, 40% of the USA's, and 25% of the UK's generic drug requirements, as per the report. This highlights India's critical role in global healthcare, but the reliance on Chinese raw materials and intermediates threatens this position.
Dependence on Chinese Imports
The NITI Aayog report underscores that a substantial portion of active pharmaceutical ingredients (APIs) and key starting materials are imported from China. This supply chain concentration creates risks of disruptions due to geopolitical tensions or trade disputes.
According to the report, "India's pharmaceutical industry is heavily dependent on China for key raw materials, which could impact production and export capabilities." The dependency is particularly acute for certain antibiotics, vitamins, and cardiac drugs.
Impact on Domestic Production
The heavy reliance on Chinese imports affects India's ability to ensure uninterrupted supply of essential medicines. The report warns that any disruption in Chinese exports could lead to shortages and price hikes in the domestic market.
To mitigate this, NITI Aayog recommends boosting domestic manufacturing of APIs and intermediates through policy support and incentives. The government has already launched schemes like the Production Linked Incentive (PLI) scheme for pharmaceuticals to reduce import dependence.
Way Forward
The report calls for strategic investments in domestic API production and diversification of import sources. It also suggests strengthening the supply chain resilience through stockpiling and international cooperation.
India's status as the "pharmacy of the world" is at stake if the dependency on Chinese imports is not addressed, the report concludes.
