Dirty business: UP sanitiser makers claim black-marketing of raw material

Drug body says key ingredient IPA currently being sold for Rs 360 a litre in the state against a normal price of Rs 95

With the demand for hand sanitisers skyrocketing due to the coronavirus outbreak, local manufacturers in Uttar Pradesh have alleged brazen black marketing of its main raw material, isopropyl alcohol (IPA), which was allegedly impeding plans to increase production as directed by the central and state governments.

According to UP Drug Manufacturers Association (UPDMA) president Prashant Bhaiya, IPA is currently being sold for Rs 360 per litre in the state against a normal price of Rs 95 per litre.

Noting that hand sanitisers could be effectively manufactured with ethanol/ethyl alcohol, as advised by the World Health Organisation (WHO), he alleged there were severe bottlenecks in the supply of ethanol from the state distilleries, and were dependent upon the discretion of the excise department officials in the respective districts.

Further, he claimed empty hand sanitiser bottles, which were earlier available for Rs 2 apiece were not available for even Rs 6 piece, thus indicating its shortage and possible black marketing. There is short supply of the bottle caps as well in the market, he added.

Meanwhile, UPDMA has written a letter to chief minister Yogi Adityanath pledging to make available hand sanitisers on a “war footing’ to meet the growing demand to curb the spread of the scourge in UP, while apprising the CM of the challenges facing the manufacturers.

Recently, the UP government had urged the surgical mask and hand sanitiser units operating in the state to augment their production by working in three shifts a day even as new units were promised with speedier approvals.

Bhatiya said there was ample availability of ethanol in UP yet the supply impediment was proving to be a major hurdle in increasing the production of ethanol based hand sanitisers. He urged the CM to issue directives to the distilleries to ensure ready supply of ethanol to the hand sanitiser units.

Besides, he suggested for revisiting the ceiling on hand sanitiser retail price which has been fixed at Rs 100 for a 200 ml bottle, saying the cost of production of smaller quantities was higher compared to bigger quantity bottle. Therefore, it would be commercially unviable for the companies at this ceiling.

Meanwhile, he demanded the government to pare the Goods and Services Tax (GST) on ethanol and IPA from 18 per cent to 12 per cent given the present circumstances, since hand sanitisers were treated as drug and attracted tax of 12 per cent only.

Recently, the Indian Sugar Mills Association (ISMA) had written to the Centre assuring that the domestic sugar industry would supply adequate quantities of ethanol or extra neutral alcohol (ENA) according to the requirement for use in the manufacture of hand sanitisers.

The Association had advised sanitiser manufacturers to directly contact sugar mills for their ethanol/ENA requirement for their requirements.