How does the government support entrepreneurs in the medical device space?

The Indian government actively supports entrepreneurs in the medical device space through a variety of policies, schemes, and incentives aimed at fostering innovation, reducing import dependency, and positioning India as a global hub for medical device manufacturing. Here’s a detailed look at the government’s support mechanisms:

1. Financial Incentives and Schemes:

• Production Linked Incentive (PLI) Scheme:
  • Provides financial incentives to boost domestic manufacturing of medical devices in high-growth sectors such as imaging equipment, implants, and diagnostic devices.
  • Incentives are based on incremental sales of locally manufactured devices, reducing the cost burden on manufacturers.
  • Total allocation: ₹3,420 crore. (More Details)
• Medical Device Parks Scheme:
  • Encourages the establishment of medical device parks with shared infrastructure to reduce manufacturing costs.
  • Approved parks: Andhra Pradesh, Himachal Pradesh, Madhya Pradesh, and Tamil Nadu.
  • Total financial outlay: ₹400 crore.
• Startup India Initiative:
  • Provides tax benefits, funding support, and fast-track patent processing for startups, including those in the medical device sector.
  • Startups are exempt from paying income tax for three consecutive years under this initiative.
• Credit Guarantee Scheme:
  • Facilitates collateral-free loans for micro, small, and medium enterprises (MSMEs) engaged in medical device manufacturing.
  • Aimed at improving access to working capital.

2. Innovation and R&D Support:

• Biotechnology Industry Research Assistance Council (BIRAC):
  • Offers funding through programs like the Biotechnology Ignition Grant (BIG) and Small Business Innovation Research Initiative (SBIRI) for startups in medical device innovation.
• Make in India Initiative:
  • Promotes R&D and the local development of high-tech medical devices.
• Centre of Excellence (CoE) Programs:
  • Collaborations with institutions like IITs and AIIMS to set up CoEs focused on medical device innovation and testing.

3. Regulatory Reforms:

• Simplified Regulatory Framework:
  • The introduction of the Medical Devices Rules, 2017, streamlines approvals and creates separate provisions for medical devices, distinct from pharmaceuticals.
• 100% FDI in Medical Devices:
  • Allows 100% Foreign Direct Investment (FDI) under the automatic route, encouraging international collaboration and investment in the sector.

4. Export Promotion:

• Export Subsidies:
  • Provides incentives to manufacturers for exporting medical devices to international markets.
• Brand India Campaign:
  • Promotes Indian-made medical devices in global markets to enhance competitiveness and reputation.

5. Infrastructure Development:

• Medical Device Parks:
  • Offers infrastructure like common testing labs, calibration centers, and logistics support, reducing setup and operational costs.
• Andhra Pradesh MedTech Zone (AMTZ):
  • A dedicated manufacturing zone offering facilities like 3D printing, material testing labs, and sterilization units for entrepreneurs.

6. Capacity Building and Training:

• Skill Development Programs:
  • Initiatives under the Skill India Mission provide specialized training in medical device manufacturing, quality control, and R&D.
• Collaborations with Academia:
  • Government-sponsored programs encourage collaboration between academic institutions and entrepreneurs to foster innovation.

7. Tax and Duty Benefits:

• Reduced Import Duties:
  • On raw materials and components required for manufacturing medical devices.
• Tax Holiday for Startups:
  • Startups in the medical device space are eligible for income tax exemption for three years under the Startup India initiative.

8. Digital and Tech Support:

• Digital Health Mission:
  • Encourages startups to develop digital and AI-based medical devices aligned with India’s National Digital Health Mission (NDHM).
• Telemedicine Incentives:
  • Promotes the development of telemedicine-enabled devices to expand healthcare access.

9. Tender and Procurement Policies:

• Preference for Domestic Products:
  • Public procurement policies favor locally manufactured medical devices under the Make in India program.
• E-Procurement Portals:
  • Platforms like GeM (Government e-Marketplace) facilitate easier access to government tenders for medical devices.

10. International Collaboration:

• Technology Transfer Agreements:
  • Facilitates partnerships with foreign companies for technology transfer and joint ventures.
• Trade Agreements:
  • Bilateral agreements with key markets to reduce trade barriers for Indian medical devices.

Examples of Government-Driven Success Stories:

• Andhra Pradesh MedTech Zone (AMTZ):
  • Houses over 100 medical device manufacturers and supports startups with state-of-the-art infrastructure.
• Meril Life Sciences:
  • Benefited from government support in developing and exporting high-quality cardiovascular devices.

The Indian government’s multi-faceted approach supports entrepreneurs in the medical device sector through financial incentives, regulatory simplifications, infrastructure development, and export promotion. These initiatives collectively aim to foster innovation, reduce import dependency, and make India a global leader in medical device manufacturing. Entrepreneurs can leverage these programs to scale their businesses and contribute to India’s healthcare ecosystem.