(a) whether a proposal to encourage and approve the Foreign Direct
Investment (FDI) in drug manufacturing industry is pending for consideration
for the last many months in the country;
(b) if so, tne details thereof;
(c) whether the Prime Minister has taken initiative by intervening
in this matter recently for solving this problem; and
(d) if so, the facts in this regard and the reasons for the delay in
taking the final decision?
MINISTER OF STATE (INDEPENDENT CHARGE) OF THE MINISTRY OF STATISTICS AND
PROGRAMME IMPLEMENTATION AND MINISTER OF STATE IN THE MINISTRY OF CHEMICALS AND
FERTILIZERS (SHRI SRIKANT KUMAR JENA)
(a) to (d) With a view to examine the issues involved in a broader perspectives,
Planning Commission has with the approval of the Hon`ble Prime Minister constituted
a High Level Committee (HLC) under the Chairpersonship of Shri Arun Maira,
Member (Industry), Planning Commission to consider all the relevant aspects.
The Hon`ble Prime Minister chaired a meeting to discuss the FDi policy in drugs
and pharmaceutical sector on 10th October, 2011. The meeting deliberated upon the
report of Shri Arun Maira, Member (Industry), Planning Commission which followed a
CCEA decision to get greater clarity on the issue of FDI policy governing mergers
and acquisitions in the pharmaceutical sector, while striking a balance between
larger public health concerns and strengthening domestic manufacturing capacities.
The following considered decisions were taken in the meeting:
(i) India will continue to allow FDI without any limits (100%) under the automatic
route for Greenfield investments in the pharma sector. This will facilitate addition
of manufacturing capacities, technology acquisition and development;
(ii) In case of brownfield investments in the pharma sector, FDI will be allowed
through the FIPB approval route for a period of upto six months. During this period,
necessary enabling regulations will be put in place by . the CCI for effective
oversight on mergers and acquisitions to ensure that there is a balance between
public health concerns and attracting FDI in the pharma sector. Thereafter,
the requisite oversight will be done by the CCI entirely in accordance with the
competition laws of the country.
Subsequently, Department of Industrial Policy & Promotion issued Press Note
No. 3(2011 Series) dated 08.11.2011 amending the existing FDI policy under which
100% FDI was permitted through automatic route. As per press Note 3(2011 Series)
issued by Department of Industrial Policy and Promotion on 08.11.2011:-
(i) FDI, upto 100%, under the automatic route, would continue to be permitted for
greenfield investments in the Pharmaceuticals sector,
(ii) FDI upto 100%, would be permitted for brownfield investment (i.e. investments
in existing companies), in the Pharmaceuticals sector, under the Government approval
route.
The Department of Industrial Policy and Promotion who are nodal Department of Foreign
Direct Investment (FDI), has informed that the policy for allowing FDI, up to 100% in
existing companies, in the Pharmaceuticals sector, under the Government approval route,
was introduced vide Press Note 3 of 2011, dated 08.11.2011. This provision has since
been incorporated under `Circular 2 of 2011 - Consolidated FDI Policy`,
effective from 10.04.2012.