Govt notifies Medical Device Park scheme with financial outlay of Rs 400 crore

Published On 2021-09-26 05:30 GMT   |   Update On 2021-11-23 11:23 GMT

New Delhi: In a bold move to make India 'Aatmanirbhar', the Central Government has launched a scheme for the development of 'Medical Device Parks,' which is a vital initiative to promote medical devices, with a financial outlay of Rs. 400 crore for the period FY 2020-2021 to FY 2024-2025.

Under this scheme, the governments of Himachal Pradesh, Tamil Nadu, Madhya Pradesh, and Uttar Pradesh have already been granted "in principle" approval to establish Medical Device Parks, according to the ministry.

Identifying the Medical Device industry as a sunrise sector with significant potential for diversification and employment generation, the Central Government has taken this step in favour of the medical devices industry to fulfil its potential in the coming years. The scheme aims to significantly reduce manufacturing costs, optimise resources, build on economies of scale, and provide easy access to standard testing and infrastructure facilities.

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This action follows the recognition of the necessity for higher levels of investment for the creation of proper infrastructure in the Medical Device sector. In response to this demand, the Department of Pharmaceuticals has introduced the "Promotion of Medical Device Parks" Scheme, which has the following goals:

a. Easy access to standard testing and infrastructure facilities through the creation of world class common infrastructure facilities for increased competitiveness will result in a significant reduction in the cost of production of medical devices, leading to better availability and affordability of medical devices in the domestic market.

b. Reaping the benefits arising due to optimization of resources and economies of scale.

Accordingly, the Ministry of Chemical and Fertilizers declared that the Medical Devices Parks to be developed under the scheme will provide common infrastructure facilities in one place, thereby creating a robust ecosystem for medical device manufacturing in the country and also reducing the manufacturing costs significantly.

The total financial outlay of the scheme is Rs. 400 crore and the tenure of the scheme is from FY 2020-2021 to FY 2024-2025. The financial assistance to a selected Medical Device Park would be 70% of the project cost of common infrastructure facilities.

In the case of the North Eastern States and the Hilly States, financial assistance would be 90% of the project cost. Maximum assistance under the scheme for one Medical Device Park would be limited to Rs. 100 crores.

Further, the Ministry revealed that in total, proposals from 16 States/UTs were received under the scheme.

The selection of the States/UTs is based on the challenge method, which is reflected in the evaluation criteria of the scheme. The ranking methodology for States/UTs is based on the parameters prescribed in the scheme guidelines such as utility charges, State policy incentives, total area of the park, land lease rate, connectivity of the park, ease of doing business ranking, availability of technical manpower etc, the Ministry stated.

Based on the evaluation, the proposals of the state governments of Himachal Pradesh, Tamil Nadu, Madhya Pradesh, and Uttar Pradesh have been given "in-principle" approval to set up Medical Device Parks under the scheme.

Further qualitative assessment of the said states in terms of their fiscal capability, ecosystem attractiveness, and industrial presence also validated the selection of these states.

In respect to the above scheme, the Ministry stated, "The scheme reflects the spirit of co-operative federalism where the Central Government and State Governments will partner to develop the Medial Device parks for better performance of the sector."


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