Exporters Line Up For Restricted API Licence

We have received about 200 licence applications. We will examine them,” said an official in the know of the development.

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World import export medicines
Picture: Pixabay

New Delhi, 16 March 2020: Exporters have lined up applications seeking licence to ship restricted Active Pharmaceutical Ingredients or APIs. The government has received as many as 200 applications from pharma firms in a span of 10 days after it tightened their export norms.

“We have received about 200 licence applications. We will examine them,” said an official in the know of the development.

The government, on March 3, restricted the exports of 26 API and formulations, including paracetamol and vitamins B1, B6 and B12 in order to ensure there is no shortage of drugs in India due to the lockdown in China’s Hubei’s province, the epicentre of the coronavirus outbreak, and a major source of these raw materials.

Tinidazole, metronidazole, acyclovir, progesterone, chloramphenicol, erythromycin salts, neomycin, clindamycin salts and ornidazole were the other APIs whose exports are now restricted amid the outbreak of the Covid-19 pandemic, the Directorate General of Foreign Trade (DGFT) had said in a notification.

As per industry sources, around 240 licence applications have been referred to the commerce and industry ministry.
Drug and pharma exports from India rose 11.7% on year to touch $19.15 billion in the 11 months to February 2020.

Also read: Pharma Cos ask Govt to lift API’s export restrictions

Though India is a source of about 20% of the world’s generic drugs supply, pharma companies in the country are dependent on China for two-thirds of the chemical components needed to make them.

Italy, another major API manufacturer, too is hit by the virus. India’s API imports are valued at $3.5 billion per year, of which 70%, worth $2.5 billion, come from China. API imports from the US and Italy are pegged at around $400 million.

“There are different configurations of these raw materials. We will analyse them and then take decisions on the licenses,” the official added.

The Pharmaceuticals Export Promotion Council of India (Pharmexcil) has flagged that many products which were not listed in the notification but fall under the group of products with the same tariff codes have been kept on hold by the customs authorities.

As per Udaya Bhaskar, director-general at Pharmexcil, besides leading to blacklisting of the companies by the procurement agencies and imposition of penalties, the non-supply of one item could result in cancellation of the entire order for all other products.

“Formulations manufactured for exports as per the specific countries requirements (pharmacopoeia specifications/labels/printing material used) cannot be diverted or utilised in the domestic market,” Bhaskar said.

Almost 30% of India’s pharma exports are to North America, 16% to Europe and 17% to Africa.

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