With an aim to enhance foreign investments and boost domestic manufacturing, the Government is likely to consider a proposal for liberalizing foreign direct investment (FDI) policy soon for the cash-starved medical devices sector. The proposal to relax the FDI policy has been mooted by the Commerce and Industry Ministry.
As the medical devices sector falls under the pharmaceutical category, it is accordingly subjected to FDI limits and other conditions such as mandatory government nods. FDI in medical devices sector is permitted through government-approval route, however the industry has been demanding that FDI should be put under the automatic route. India badly needs foreign investments in medical devices and equipment sector.
Industry is of the view that the domestic companies are not competitive as global firms and not big like drug firms and thus there is no threat of mergers and acquisitions from multi-national firms.
Medical devices include wide range of products such as implants sutures and surgical instruments. The present market size of the industry stands at around $7 billion. As per estimates, India imports about 70 percent of its requirement of medical devices. The industry size is about $7 billion in the country.