Parliamentary panel asks DoP to chalk out timeframe for promotion of medical devices park scheme

New Delhi, December 10, 2021:

The Parliamentary Panel for ministry of chemicals and fertilizers has asked the Department of Pharmaceuticals (DoP) to chalk out a timeframe to complete the procedures on the scheme for promotion of medical devices parks in the country.

The Department Related Parliamentary Standing Committee for the Ministry of Chemicals and Fertilisers, chaired by Member of Parliament Kanimozhi Karunanidhi, raised its concerns on the lack of progress since the revision of the Sub-Scheme ‘Promotion of Medical Devices Parks’ on July, 2020.

In its report in early December, the panel said that as per the action taken reply from the DoP, application window of the Scheme was closed on October 15, 2020 and 16 proposals submitted by States and Union Territories are still under evaluation till July 8, 2021 when the reply was furnished by the DoP to the Committee.

“That means evaluation process has not been completed even after the lapse of nine months. The Committee feel that the Department should chalk out a time frame for completing the exercise of evaluation instead of lingering on indefinitely. The scheme is very crucial to make our country self reliant and major manufacturing hub of medical devices,” said the report.

The Committee, therefore, strongly reiterate the earlier recommendation that the Department should take earnest steps for granting expeditious approvals to the eligible proposals under the Scheme during 2021-22 and financial assistance should also be provided to them according to the Scheme guidelines in a time bout manner.

The progress made in this regard should be furnished to the Committee in the Final Action Taken Replies by the Department, it added.

In its previous report in March, this year, the Committee criticised that the sub-scheme named “Assistance to Medical Device Industry for Common Facility Centre” was also not properly implemented by the Department and the same has been revised by the Union Cabinet during 2020-21. The sub-scheme has been renamed as “Promotion of Medical Devices Parks” with a total financial outlay of Rs. 400 crore.

The objective of the sub-scheme is creation of world class infrastructure facilities in order to make Indian medical device industry a global leader.

The tenure of the scheme is from 2020-2021 to 2024-2025. Maximum assistance under the scheme for one Medical Device Park would be limited to Rs. 100 crore. Under this Scheme an allocation of Rs.7.50 crore was made at Budget Estimation stage of 2020-21 and the same was increased to Rs. 21.05 crore but the Department is able to spend only Rs 7.49 crore so far, it said in March. In this background, the Department had demanded Rs.120 crore for the implementation of the Scheme during 2021- 22 but the Ministry of Finance has allocated only Rs.60 crore at BE stage.

The Committee noted that in-principle approvals were given to the proposals received from Andhra Pradesh, Kerala, Tamil Nadu and Telangana. Subsequently the proposal of Andhra Pradesh was first taken up. After revision of the scheme by the Union Cabinet, the guidelines of the revised scheme were issued on July 27, 2020.

After the revision of the scheme, 16 proposals have been received in accordance with the revised guidelines of the scheme. All the proposals are being evaluated for giving in-principle approval.

"Taking into consideration the importance of common laboratory and testing facilities in reducing the production cost of medical devices, the Committee recommend that the Department should take earnest steps for granting expeditious approvals to the eligible proposals under the Scheme during 2021-22 and financial assistance should also be provided to them according to the Scheme guidelines in a time bound manner. In case of necessity of further funds for the implementation of the Scheme during 2021-22, concrete proposals for allocation of the same at RE stage should be made to the Ministry of Finance," it recommended then.

DoP, in reply to these recommendations of the Committee in March, informed the panel that under the sub-scheme as “Assistance to Medical Device Industry for Common Facility Center”, the Department has given approval for financial assistance of Rs. 25 crore to the project of Andhra Pradesh Medtech Zone Ltd (AMTZ), Andhra Pradesh for development of Common Facility Center for superconducting magnetic coils testing and research facility.

A Budgetary allocation of Rs. 7.50 crore was allocated under the scheme in Budget Estimates 2020-21. The Department has released 1st instalment of Rs. 7.49 crore for the project to AMTZ on September 11, 2020. The budget allocation was increased to Rs. 21.05 crore in Revised Estimates but no re-appropriation order was issued to enable this Section to release the fund. Hence, the actual allocation was of Rs. 7.50 crore. The second installment was also released later during the year 2021, according to reports. Pharmabiz