India plans to introduce a minimum import price MIP for selected pharmaceutical raw materials for promoting domestic production and reduce dependency on China. India contributes 20% of the global supply of 60000 generic drug brands, across 60 categories.
This step was to protect Indian manufacturers from the ball of cheap imports from China and increase their own efficiency.
India, by doing this, aims to promote domestic manufacturers as it will provide them a chance to promote Make-in-India pharma and also provide employment opportunities.
So far India has grown in many sectors and India is becoming self dependent, it promotes Domestic manufacturers to boost themselves and their works.
It will Reduce Dependency on Chinese Imports- India imports nearly 80% of its APIs and KSMs from China.
This heavy dependency creates supply chain vulnerabilities, especially seen during COVID-19 and geopolitical tensions. At that time, India was helpless. So, in future we don’t see any situations similar to these. The government is adopting new steps and measures day-by-day, and stepping in the direction of being Self Dependent.
It will also Boost Domestic Manufacturing – minimum import prices will discourage cheap imports that undercut local manufacturers, and will help boost them to grow and even expand their business.
Encourages Make in India by ensuring local players can compete fairly on price. Prevent Dumping of Cheap Goods-Some Chinese exporters sell below cost to gain market share (a practice known as dumping). It’s done to benefitting yourself while downplaying others.
MIP acts as a barrier, setting a floor price to protect Indian industry from being wiped out by predatory pricing. Moreover, the phrase Atmanirbhar Bharat was popularized by Prime Minister Mr. Narendra Modi seems strong in this game. While MIP and promoting domestic companies and local manufacturers, we are moving in the direction of Atmanirbhar Bharat ( self-independent India).
The policy, currently under discussion between the Department of Pharmaceuticals and the Ministry of Commerce, targets a specific list of formulations and bulk drugs that India heavily imports at very low prices, often undercutting local producers.
The decision to impose MIP is driven by concerns over unfair price competition, rising import dependency, and the potential strategic risk posed by over-reliance on a single country—especially China, which currently accounts for over 65% of India’s bulk drug imports.
By setting a floor price on imported pharmaceutical products, the government aims to create a level playing field for Indian manufacturers, who struggle to match the ultra-low prices of Chinese generics due to higher production and compliance costs. This move is expected to revive domestic Active Pharmaceutical Ingredient (API) production, promote investments in pharmaceutical parks, and support the Atma Nirbhar Bharat (self-reliant India) initiative.
While this step is welcomed by Indian pharma companies, critics warn it may temporarily impact drug affordability, especially for small retailers and hospitals dependent on cheaper Chinese supplies. However, officials emphasize that essential medicines and life-saving drugs will be carefully reviewed before inclusion in the MIP list to avoid any public health impact.
If implemented effectively, the MIP policy could boost India’s pharma manufacturing ecosystem, reduce import dependency, and strengthen national drug security. It also signals a broader shift in India’s trade policy towards strategic self-reliance amid global supply chain realignments and increasing geopolitical tensions with China.