Zero customs duty on medical device to kill Make in India program

 20-Jan-17, Business Standard

India is one of the top twenty markets for medical devices in the world and is growing at a rapid pace. The medical technology sector can make great contributions in terms of economic growth, job creation and enhanced innovation, and the ‘Make in India’ campaign is a major boon to the industry. At present, 70 percent of the medical equipments used in India are imported. 

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In Jan-16, the government announced the first fiscal policy to support Indian manufacturing by withdrawing concessional duty for nearly 30 percent of devices. The same kind of benefits should be given to IVD and Implantable medical devices. There is no logic to have zero percent customs duty on any medical device, equipment or consumables as this will kill the Make in India initiative by both MNCs and domestic companies.

In China, much higher reimbursement is allotted to locally produced medical devices and equipment. India should learn from China and Brazil, two large medical devices markets where they pushed local manufacturing initiatives over the past two decades to become import independent and export focused.

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