Government Boosts Domestic Chemical and Pharma Manufacturing
The government is intensifying efforts to bolster domestic chemical and pharmaceutical manufacturing through a multi-pronged strategy. This includes combining infrastructure development like PCPIRs, Plastic Parks, Bulk Drug Parks, and Medical Devices Parks with Production Linked Incentive (PLI) schemes. The aim is to attract investment, scale up production, and significantly reduce reliance on imports of key chemicals, APIs, and medical devices, driving self-sufficiency and job creation across these crucial sectors.
The Indian government is significantly ramping up its initiatives to enhance domestic chemical and pharmaceutical manufacturing, as announced by the Ministry of Chemicals and Fertilizers. This strategic push integrates robust infrastructure development with Production Linked Incentive (PLI) schemes to stimulate investment, boost production capacity, and minimize import dependency across vital sectors.Central to this expansion are Petroleum, Chemical and Petrochemical Investment Regions (PCPIRs), which offer cluster-based development with large-scale, environmentally compliant infrastructure and shared support services, attracting new investments and generating employment. Additionally, the Plastic Park Scheme is advancing downstream plastic processing by supporting modern industrial parks, with the Centre contributing up to 50% of costs, capping at ₹40 crore per park, with nine parks already approved.To foster innovation, eighteen Centres of Excellence (CoEs) have been established under the petrochemicals scheme, focusing on developing new technologies, improving existing processes, and supporting R&D in polymers, plastics, and chemicals, with up to 50% government funding (capped at ₹5 crore).In the pharmaceuticals sector, three Bulk Drug Parks, located in Andhra Pradesh, Gujarat, and Himachal Pradesh, have been sanctioned with a total outlay of ₹3,000 crore. These parks will receive substantial central assistance for critical common infrastructure like effluent treatment, utilities, and warehousing. Similarly, three Medical Devices Parks in Greater Noida, Ujjain, and Kanchipuram are progressing with a ₹300 crore budget, with common infrastructure nearing completion. By September 2025, 194 medical device manufacturers had been allotted land in these parks, and construction had commenced for 34 units. PLI schemes are also playing a crucial role in accelerating domestic API and pharmaceutical production, considerably reducing India’s reliance on imported raw materials.
