India to restart Penicillin G manufacture: why was it stopped, what changed now

Syllabus: GS-III, Subject: Economy, Topic: Industry and industrial policies, Issue: Pharmaceutical Industry

Context: India to start manufacturing the common antibiotic Penicillin G with the help of PLI scheme.

  • Penicillin G is the active pharmaceutical ingredient (API) used in manufacturing several common antibiotics.
  • Penicillin manufacturing in India ceased due to cheaper Chinese products flooding the market, rendering Indian production unviable.
  • Customs rules relaxation and the Drug Prices Control Order, favoring cheaper imports, exacerbated the decline in API manufacturing.
  • Delay in restarting production was due to lack of focus on self-reliance, high initial costs, and competition with established Chinese suppliers.

PLI scheme supporting manufacturing

  • Government launched the PLI scheme to support domestic API manufacturing and reduce dependence on imports.
  • The PLI scheme offers incentives for fermentation-based bulk drugs like antibiotics and chemically synthesized drugs to encourage domestic manufacturing.
  • The PLI scheme has led to a decline in API imports, but significant progress is still needed to boost domestic production.
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