Revised Guidelines for the Production Linked Incentive Scheme for Promoting Domestic Manufacturing of Medical Devices

The Department of Pharmaceuticals, Ministry of Chemical and Fertilizers vide its notification dated 21 July 2020, notified the Production Linked Incentive (PLI) Scheme for Medical Devices (Scheme), pursuant to which the first guidelines were issued on 29 October 2020. The PLI Scheme provides financial incentive to approved medical device manufacturers, which will help boost domestic manufacturing and attract large scale investment in medical devices segments viz.

(i) cancer care devices

(ii) radiology and imaging devices

(iii) anesthetics devices and

(iv) implants.

In its first round of application, the Department of Pharmaceuticals received 28 applications from 23 applicants under various product categories and approvals were granted to 13 applicants with committed investment of INR 7.99 billion. Overall, the PLI Scheme has a total financial outlay of INR 34.2 billion for the period FY 2020-21 to FY 2027-28.Subsequently, on 30 April 2021, as few slots remained unfulfilled for certain products, the Department of Pharmaceuticals had again called for applications from eligible applicants. In the second round, 14 applications were received, and approvals were granted to 8 applicants with committed investment of INR 2.6 billion. With this, on completion of the second round of application, 21 applications were approved with total committed investment of INR 10.59 billion.

Recently, the Department of Pharmaceuticals vide notification dated 18 August 2022 has revised the guidelines (Revised Guidelines) and thus provided another opportunity to eligible applicants to participate in the PLI Scheme. Under the Revised Guidelines, categorization of products and the corresponding threshold/ incentive has been amended. With new products included in the Scheme and with lower threshold limit for these new products, it is likely that the Scheme will find favor with more applicants.

For applicants eligible to apply under Category B of the Revised Guidelines, the applications can be filed between 01 September 2022 and 31 October 2022. The application window for Category A applicants will be notified in due course.

It is recommended that existing (and potential) players in the medical devices manufacturing space should evaluate the revised eligibility and incentives and consider applying under the Scheme. The Scheme can be accessed here; the Revised Guidelines can be accessed here; Notification dated 24 August 2022 can be accessed here. We trust you will find this update an interesting read.

Authors: Deni Shah 

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