In their pre-budget memorandum, submitted to the Finance Ministry, Union Health and Family Welfare Minister JP Nadda, Secretary Apurva Chandra; and Arunish Chawla, Secretary, Department of Pharmacy, the industry body urged to increase customs duty from the current 7.5 per cent.
“This will foster a more balanced business environment, encourage domestic manufacturing and reduce dependence on imports, which currently still constitutes a staggering 70 per cent of the sector,” said Rajiv Nath, Forum Convener, AiMeD.
"Imports of medical devices have consistently crossed Rs 61,000 crore for the last three years and unfortunately this year they increased by 13 per cent to Rs 69,000 crore," he added.
A major concern noted by AiMeD in the memo is the prevailing inverted role structure. To address this, AiMeD proposed implementation of a 5 per cent health tax on customs duty for remaining medical devices, as earlier applied to limonite medical devices, and this health tax was used to fund resources for Ayushman Bharat .
"This correction is expected to harmonize the duty structure, making it more conducive for local manufacturers to prosper and be competitive globally and locally," Nath said.
Another fundamental aspect highlighted by AiMeD is the need to limit the commercial margin.
“By monitoring the Maximum Retail Price (MRP) of imports, the government will curb excessive margins often seen in the market. This move will make medical devices more affordable and accessible to the Indian population, which will ultimately benefit public health as consumers are affected not so much by import duty protection but by the artificially inflated MRP. of medical devices,” he said.
Further, Nath said the Union Budget for FY 2024-25 should also announce income tax benefits specifically designed for capital expenditure (CAPEX) and investments in research and development (R&D) within the manufacturing sector. medical devices.
"Such tax incentives are crucial to foster innovation, improve manufacturing capabilities and propel India towards self-sufficiency in medical technology," he said.
Nath also urged the government to increase basic customs duty from 0-7.5 per cent to 15-20 per cent for non-IT Agreement-1 devices, encourage quality production and exports and should also eliminate input tax credit for integrated goods and services. Tax (IGST) on items with zero import tariff to avoid unfair advantages over national producers.
He said the Center should stop import of used or old medical devices, ensuring safety, environmental protection and growth of domestic industry, and should introduce performance-linked incentive scheme to promote value-added production for highly imported products.
“This will foster a more balanced business environment, encourage domestic manufacturing and reduce dependence on imports, which currently still constitutes a staggering 70 per cent of the sector,” said Rajiv Nath, Forum Convener, AiMeD.
"Imports of medical devices have consistently crossed Rs 61,000 crore for the last three years and unfortunately this year they increased by 13 per cent to Rs 69,000 crore," he added.
A major concern noted by AiMeD in the memo is the prevailing inverted role structure. To address this, AiMeD proposed implementation of a 5 per cent health tax on customs duty for remaining medical devices, as earlier applied to limonite medical devices, and this health tax was used to fund resources for Ayushman Bharat .
"This correction is expected to harmonize the duty structure, making it more conducive for local manufacturers to prosper and be competitive globally and locally," Nath said.
Another fundamental aspect highlighted by AiMeD is the need to limit the commercial margin.
“By monitoring the Maximum Retail Price (MRP) of imports, the government will curb excessive margins often seen in the market. This move will make medical devices more affordable and accessible to the Indian population, which will ultimately benefit public health as consumers are affected not so much by import duty protection but by the artificially inflated MRP. of medical devices,” he said.
Further, Nath said the Union Budget for FY 2024-25 should also announce income tax benefits specifically designed for capital expenditure (CAPEX) and investments in research and development (R&D) within the manufacturing sector. medical devices.
"Such tax incentives are crucial to foster innovation, improve manufacturing capabilities and propel India towards self-sufficiency in medical technology," he said.
Nath also urged the government to increase basic customs duty from 0-7.5 per cent to 15-20 per cent for non-IT Agreement-1 devices, encourage quality production and exports and should also eliminate input tax credit for integrated goods and services. Tax (IGST) on items with zero import tariff to avoid unfair advantages over national producers.
He said the Center should stop import of used or old medical devices, ensuring safety, environmental protection and growth of domestic industry, and should introduce performance-linked incentive scheme to promote value-added production for highly imported products.
