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Govt should pay heed to grievances of MSMEs before finalizing capping on trade margins: Jagdeep Singh
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Peethaambaran Kunnathoor, Chennai
August 09 , 2022
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The frequent changes in pharma policies with restrictions and new guidelines being unveiled by the government after replacing the existing ones are putting disruptions to the operations of the pharma micro, small and medium enterprises (MSMEs) in Punjab, according to the drug manufacturers in the state.
The changes that occurred in the government policies in the last 17 years rendered the business of the drug manufactures unviable and the latest in the series of changes is being conceptualized by the government at present is with respect to capping on trade margins on non-scheduled drugs. It is expected that the trade margin capping will force the pharma MSME sector in Punjab to move to rack and ruin, observes Jagdeep Singh, president of the Punjab Drugs Manufacturers Association (PDMA).
Talking to Pharmabiz he said, “In 2005 when the MRP-based excise levy was the problem faced by the MSME sector. It caused several units to move away from Punjab to excise-free zones in Himachal Pradesh and nearby states to set up their business houses. A few years later, the changes in packing norms made the MSMEs to waste lakhs of rupees by each unit and it had caused tremendous financial losses to several manufacturers. Now the trade margin cap is hanging on our heads”, says the industry leader of the ‘Land of Five Waters’.
Singh points out that the frequent policy changes being introduced by the government without hearing the grievances of the manufacturers always prevent them from scaling up. He said the current discussion on policies on trade margin cap will definitely result in adverse impact on the operations of the MSME units. So, without creating further problems the government should be kind enough to given an ear to the problems of the small scale drug manufacturers of Punjab before finalizing trade margin cap policy. The pharma leader alleged that the government has so far not called the MSME sector, which is the thrust area of the pharmaceutical industry in the country, to review their grievances and find solutions.
Talking exclusively on Punjab pharma industry, the president of the PDMA said the export of pharmaceuticals from the state is gradually picking up and about 15 companies are engaged in the overseas business. The state pharma sector comprises 200 units and more than 500 units had migrated to Baddy in 2005, 6 and 7 periods.
When asked about the support of the state government, he said the Punjab government is not giving any price preference to the local manufacturers. Although there is no obvious priority for the MSME sector, the government is supporting it in all forms. In addition to the 200 formulation units, there are about 20 companies of API manufacturing. However, the drug manufacturing industry buys APIs mostly from China. Jagdeep Singh expresses the hope that the new government in Punjab will listen to the demands of the pharma SMEs and provide maximum support.
As regards training and workshops for the industry, he said the CDSCO’s support is very poor and negligible. NIPER often conducts seminars and training programmes for the skilled workers of the industry.
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