Budget brings no cheer to pharma sector

July 10, 2014 11:55 pm | Updated June 13, 2016 07:41 am IST - VISAKHAPATNAM:

Pharma sector in Andhra Pradesh is a disappointed lot as the Union Budget has no proposals of incentives to boost exports from the State.

Being the largest pharma manufacturing centre in Andhra Pradesh, Parawada, Nakkapalli, Pydibhimavaram and Ranasthalam in North Andhra have attracted several investments particularly in bulk drug sector.

Failure to scrap Minimum Alternate Tax (MAT) has upset many. Incidentally, the industry had represented to the government to unveil a policy to ensure uninterrupted power supply.

Even the Prime Minister of Japan has represented to the Government of India to withdraw MAT. Eisai Pharmatechnology & Manufacturing Pvt. Ltd, one of the major Japanese investors in Jawaharlal Nehru Pharma City at Parawada, went on record saying that on hand the government was giving incentives to units coming up at Special Economic Zone and taking away benefits in the form of MAT on another.

Incidentally, investments worth Rs.2,000 crore, including the expansion plan of Eisai, were put on hold due to introduction of MAT by UPA government. Regular power cuts have also hampered the production schedules, investors, whom The Hindu contacted soon after budget presentation, said.

“There is nothing much to cheer for us. We had expected a lot to make this region a major pharma hub,” Aurobindo Pharma pydibhimavaram unit head and senior vice-president M. Subrahmanyam said.

Several entrepreneurs said it would be difficult to achieve export target of $25 billion for want of incentives for R&D, exemption of duties for import of raw material and equipment and facilities for refrigerated storage at airports.

“On the whole, it is neither good nor bad. But going by the amount of competition and problems encountered by us, it does not show any progressive outlook,” Glochem Industries Ltd COO K. Sandeep, said.

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