Bengaluru: There is no incentive for the healthcare industry to manufacture in India but actually disincentives, said a top executive of a leading company that also manufactures healthcare products.
“The government thinks by increasing import duty on medical equipment, people will start manufacturing tomorrow. It doesn’t work like that. Where is the technology and why will you make in India and incur more cost and charge the patients more,” said Philips India Managing Director Raja Venkatraman on the sidelines of Philips Innovation Experience 2016 here on Tuesday.
“You make in India primarily if you get the cost structure down and if it is viable to make in India at the volumes that you require in the Indian market,” he said, adding that there is general euphoria about the government’s ‘Make in India’ programme but no technology to make high end products.
“You need the technology to make that. I know you can’t make MRI scanners in India, there is no technology available in India. Nobody is going to give it to you over a handshake. So that’s number one we have to know about,” said Venkatraman.
Only black and white x-ray and ultra sound machines, ECGs, defibrillators, stethoscopes and other small devices are made in India, he said, adding that for the success of ‘Make in India’, in many areas, the products have to be designed to suit the Indian market.
Citing the case of cellphone manufacturing in India, he said it has been possible to manufacture them in India only because the duty tariff structure was adjusted in a manner to make it convenient and economical to do so.
Despite not having IC chip and semiconductor manufacturing in India, cellphone manufacturers are bringing consignments from China in a box, labelling them as made in India which is virtual packaging, he said.
“That’s what is made in India. Because don’t forget, that critical component in that (cellphone) is the IC chip, the semiconductor chip. You don’t have any semiconductor plants in this country. You are far away from it.
“So I think it is very important that people understand first to make in India, you got to have technology, you got to have cost competitiveness, you got to have a market…Most importantly you got to create an ecosystem which enables you to make it and make it to the benefit of the industry as well as for the customer,” said Venkatraman.
According to him, the $160 billion Indian software industry managed to achieve the success it is enjoying today because of government’s handholding, several years of tax holidays, land and buildings, standing order papers and a plethora of other things which healthcare industry can also replicate provided similar sops are given.
“If they do what they did to software in healthcare. Healthcare in India would be like software industry. That’s possible,” he said.
Other problems Venkatraman highlighted include pointed out to the poor state of power supply in the country, with India being one of the few countries still selling uninterrupted power supply devices along with some electronic products and the need to import helium as it is not available in India.