India Pharma Outlook Team | Friday, 25 July 2025
Under the Production Linked Incentive (PLI) Scheme aimed at increasing domestic manufacturing of critical Key Starting Materials (KSMs), Drug Intermediates (DIs), and Active Pharmaceutical Ingredients (APIs), the Government of India has sanctioned 48 projects to bolster the country’s pharmaceutical supply chain.
The scheme is aimed at reducing the dependence of India on foreign-sourced raw materials for the truly vital medicines, which do not have feasible substitutes, thus helping to lower the possibility of supply chain disruptions. Even before the scheme was rolled out, critical items were mostly imported, which made the Indian pharmaceutical sector vulnerable to external shocks and foreign political tensions.
The 48 projects are now over-delivering, having already raised actual investments to £4,254 crore as of December 2024, which is higher than the projected commitment of Rs. 3,938.5 crore over 6 years in the issued scheme.
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The effects of the PLI scheme are already noticeable as well. From the start of the scheme until December 2024, the estimated reimbursement has reached Rs. 1,556 crore, with 412 crore in exports. As a result, India has been able to import a worth of Rs. 1,144 crore, helping enhance the capacity for in-country production of 25 KSMs, DIs, and APIs.
By incentivizing local production for manufacturing, the PLI scheme thus plays an overriding role in making the pharmaceutical sector self-reliant. This is in line with the government's larger objectives of the "Atmanirbhar Bharat" by assuring a secure, resilient, and sustainable supply chain for essential medicines and raw materials.
Industry stakeholders welcomed the initiative as timely in the protection of public health and promotion of industrial growth in the life sciences sector.
