AiMeD calls for urgent action on overpriced imported medical devices to empower 'Make in India'

 

The Association of Indian Medical Device Industry (AiMeD) has called for stricter monitoring of the maximum retail price (MRP) of imported medical devices in India to ensure affordability for Indian consumers. In its pre-budget memorandum to the Finance Ministry, AiMeD highlighted that while the government’s efforts to reduce import duties on medical devices aim to lower costs, consumers are still paying 10 to 30 times the import landed price.

AiMeD has urged the government to withdraw concessional duty notifications that reduce import duties to 0 to 7.5%, advocating instead for a revised tariff structure of 5 to 15% on medical devices. According to Rajiv Nath, Forum Coordinator of AiMeD, such measures are necessary to promote domestic manufacturing and align with the “Make in India” initiative.

“Despite promises made in earlier Budget speeches, NIL and concessional duty exemptions continue to disadvantage Indian manufacturers, forcing many to turn into import traders. A predictable tariff policy with nominal protection is essential for fostering domestic production,” said Nath in a recent letter to Finance Minister Nirmala Sitharaman.

Challenges Facing Indian Manufacturers

India’s medical device industry has faced consistent challenges, including:

High Import Dependency: Over 70% of medical devices are imported, with imports exceeding Rs. 69,000 Crores in 2023-24—a 13% increase from the previous fiscal year.

Unfavorable Duty Structures: The current 0-7.5% basic import tariff, combined with GST benefits for importers, puts Indian manufacturers at a competitive disadvantage.

Manufacturing Disabilities: Indigenous manufacturers face a 12 to 15% cost disability due to factors like high infrastructure costs, limited R&D capabilities, and inadequate power supply.

AiMeD's Recommendations

To curb the growing reliance on imports and support domestic manufacturers, AiMeD has proposed the following measures:

Increase Import Tariffs: Raise basic import duties to 5-15% for finished devices and at least 5-7.5% for components.

Retain Low Duty on Raw Materials: Maintain a 2.5% concessional duty on raw materials and packaging for three more years to support local production.

Withdraw NIL Duty Notifications: Remove duty exemptions that undermine Indian manufacturing competitiveness.

Create a Favorable Ecosystem: Provide support similar to the mobile phone industry to nurture startups, MSMEs, and larger domestic manufacturers.

Impact on “Make in India”

AiMeD stressed that a robust domestic industry could adequately cater to the needs of India’s 1.4 billion population while reducing the country’s reliance on imports. The group emphasized that nominal tariff protection would incentivize manufacturers to expand capacity, enable exports, and create employment.

The association also pointed out the unintended consequences of the current duty structure. After the introduction of GST, imported devices became 11% cheaper, making it harder for domestic manufacturers to compete, especially in government tenders.

To address these disparities, AiMeD has requested the government to implement fair trade policies that protect ethical manufacturers and ensure medical security for India. By taking these steps, the government can not only strengthen India’s medical device industry but also make quality healthcare more accessible and affordable for its citizens.

AiMeD is an Umbrella Association of Indian Manufacturers of Medical Devices covering all types of Medical Devices including Consumables, Disposables, Equipments, Instruments, Electronics, Diagnostics and Implants.  With a Primary Membership of over 300 Manufacturers and additionally of over 200 Associate Members representing the interest of over 1200 Manufacturers of Medical Devices to address the manufacturer’s problems.

The aim behind forming AiMeD is  allow the Indian Government to access a single point of contact and provide various services to the manufacturers like Advocacy on policy issues, Information services, Regulations for Medical Devices, Education and Training, services, Testing Assistance and guidance for Quality Certification (ISO, CE, GMP), Lobbying for funding for R&D from the Government, encourage innovations from member units, Improve clinician and patient access to the modern, innovative and reliable Medical Device technologies through organizing and supporting Meeting, Seminars, Symposia, Exhibitions and Demonstrations and also, to promote global harmonization and respect for the  Indian Device Industry.