In the midst of recession eating into various overseas trade, it is now the Indian pharma industry that has taken a hit of one per cent in its exports, according to recent estimates by Indian Drug Indian Drug Manufaturers' Association (IDMA).
This is against the industry's expectation of posting a moderate 13-16 per cent growth in exports for 2008-09 fiscal.
The pharma companies of India have seen exports of Rs 30759.64 crore in 2008-09 as compared to Rs 31130.70 crore in 2007-08, a dent of about 1.21 per cent, according to the IDMA data bank's estimated figures.
On the other hand, the imports have gone up to 21.48 per cent from Rs 5543.09 crore in 2007-08 to Rs 6734.31 crore in 2008-09, an official survey by the association states.
"Despite financial problems, we have seen fairly good exports so far. The estimated figures of the pharma exports of India have been Rs 30,759 crore in 2008-09 as compared to Rs 31,130 crore in the previous year. Gujarat which is the hub of pharma industry witnessed an increase in production of drugs in the current year at 48 per cent against 42 per cent last year," said RS Joshi, executive secretary at IDMA, Gujarat chapter.
Joshi adds that the meltdown will not hamper the pharma industry further, and will, in fact, see a growth even during the slowdown in 2009-10.
"Even in such turbulent times, we are expecting a growth rate of 16 per cent for the pharma industry for the ongoing year," Joshi said.
More From This Section
Industry insiders believe pharma companies are expected to see a rise in sales of drugs and wellness products during recession.
According to Kamlesh Patel, chief executive officer of West-Coast Pharmaceutical Works and President of IDMA-Gujarat: "Wellness products are the most likely to see an increase during recession. Also, drugs from India are cheaper and in popular demand as people abroad prefer would cheaper drugs in times of recession. As such, the Indian pharma industry is set to benefit."
"Fortunately, the pharma industry in India has witnessed a double digit YOY growth. There has been no let up in demand. However, as with most other sectors, liquidity issues have definitely acted as showstoppers. Though the banking system has been proactive in addressing issues, extraneous factors like forex derivatives losses have plagued the system leading to challenges in receivable collections," said Ajit Kamath, CMD, Arch Pharmalabs.
According to a survey by the Federation of Indian Chambers of Commerce and Industry (FICCI), pharmaceutical exporters are expected to record 16 per cent increase in 2009-10. The survey further says that the pharmaceutical exports are likely to see an anticipated rise of 13 per cent in overseas sales, whereas export growth is anticipated to be lower as compared to 23 per cent in 2008-09.