The government of India should encourage the growth of medical device manufacturers in the country by supporting multinational companies to associate with domestic manufacturers, by providing incentives and levy reduction, says GlobalData.
Indian medical devices market is expected to grow at a compound annual growth rate (CAGR) of 7.5% through 2025, reveals the company. In 2019 the Indian medical devices market accounted for more than 13% of the Asia-Pacific medical devices market.
The Indian government had recently proposed an additional 5% health cess on imports of medical devices to encourage its domestic manufacturers and generate funds to create health infrastructure.
However, “Since India is a net importer of medical devices, additional taxes may discourage large multinationals to import newer technologies and increased cost of devices is likely to be passed on to the patients. This will limit patient access to advanced treatment options available in developed countries and may lead to an increased treatment cost,” avers Rohit Anand, Medical Devices Analyst at GlobalData.
A large number of the domestic medical device manufacturers in India are in the small scale sector and they do not have access to newer technologies, finds GlobalData. Currently, there are over 800 domestic medical device manufacturers involved in the manufacturing of medical devices, including consumables, disposables, and capital equipment.
Although the Indian government, under ‘Make in India’ initiative, is encouraging medical devices manufacturing and exports, importing medical devices is still considered as a convenient option.
“The local medical device makers are predominantly involved in the manufacturing of low-end products for domestic consumption. Improved tax structure can be another option to encourage the domestic medical device industry,” adds Anand.
A state of equality thus has to be encouraged for enabling our domestic medical device manufacturers to compete with MNCs who are equipped with strong financial and technological capabilities.