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Union Budget 2023 to create an ecosystem for growth with fiscal prudence to lifesciences, medtech sectors

Our Bureau, Bengaluru & Mumbai
Thursday, February 2, 2023, 16:30 Hrs  [IST]

Lifesciences and medical devices sectors note that the Union Budget 2023 will create an ecosystem for growth. From strengthening the nursing workforce to eradicating sickle cell anemia to supporting research and innovation for pharma, building digital technology, relief for MSMEs, budget will focus on compliances to enhance ease of doing business.

According to Dhananjay Singh, head - science and lab solutions, Merck Life Science, the latest initiatives to promote investments in R&D and healthcare infrastructure, are a step in the right direction. Launching industry-specific new age courses as part of the redesigned Pradhan Mantri Kaushal Vikas Yojana (PMKVY) 4.0 is a strong start towards supporting a sustainable life science ecosystem in terms of skill development. The emphasis on interdisciplinary courses in research, high-end manufacturing, and medical technologies is a step in the right way towards empowering the workforce with up-to-date skills required for the pharma and biopharma sectors. Innovations will be sparked by the proposal that some ICMR Labs would be open for collaborative research between public and private enterprises."

Vishal Bali, executive chairman, Asia Healthcare Holdings, said the budget’s push of 3.3% of GDP towards capital investment is a key initiative to drive the country's growth engine in a turbulent global environment. However, a mere 2.71% increase on the healthcare expenditure side is disappointing given the overall need to transform healthcare in the country.”

Aayush Rai, co-founder and CEO, Inito said that the government's announcement of launching multidisciplinary centres for medical device shows the progressive thinking and commitment towards improvement of the healthcare sector. They recognize the fundamental interdisciplinary nature of medical devices by encouraging collaboration between hardware and software engineers, physicians, and clinicians, which will pave the way for the development of novel and efficient solutions.

“The decision by the government to also allow utilisation of select ICMR labs, to encourage collaborative research with the private sector R&D teams, will help bridge infrastructure gaps in the research eco-system,” said Sibaji Biswas, CFO, Syngene International.

“The focus on pharma R&D and innovation is a step in the right direction because research-oriented incentives and policies can enable the Indian pharma industry to become the R&D, bio-innovation and bio-manufacturing hub of the world, said Kiran Mazumdar- Shaw, chairperson, Biocon & Biocon Biologics.

Surajit Chakrabartty, CFO, MedGenome Labs, stated: We as a science-focused HealthTech organization, strongly rooted in genomics, can play an effective role in bridging the demand-access gap, especially in supporting Central and state governments to manage their healthcare burden through a variety of programs, such as the screening programme for diseases like sickle cell disease and others.”

Daniel Mazon, vice chairman & managing director, Philips Indian Subcontinent, said there is a higher emphasis on expanding health infrastructure and development of technology-based solutions in India. As a health-tech company, we are committed to work with the government to further strengthen our country’s digital healthcare infrastructure and improve the lives of Indians.”

Ashwin Sapra, partner & head-healthcare, Cyril Amarchand Mangaldas said that support to R&D in the pharma sector is a welcome decision. It will help India become a leader in pharma innovation on the global stage.

Dr. Sudhir P Srivastava, founder, chairman and CEO, SS Innovations said that the Union finance minister's initiative to make available facilities in select ICMR labs for research will also give an impetus to high-end research and manufacturing which will put qualitative medical access within reach of the common man. 

Applauding the budget, Suneeta Reddy, managing director, Apollo Hospitals group said, “The Union Budget this year was an exercise in consistency, stability and transparency. It has sustained the focus on growth, while building synchrony with evolving themes for the future. It was highly forward-looking with several initiatives built to support future ambitions, talent and potential, and building the infrastructure to unlock all these”.

According to B Santhanam, CEO, Asia Pacific and India Region, Saint-Gobain and chairman, Saint-Gobain India, “The Union Budget 2023-24 is a pro-growth budget having a strong focus on green growth that will act as a key motivator for businesses to accelerate their shift towards net-zero goals and boost sustainable growth. There is a significant push to capital expenditure which will further attract private investment. The budget has also captured important aspects such as target to reach green hydrogen production of 5 MMT by 2030, implementing many programs for green growth across various economic sectors as well as create green jobs, allocation of 10000cr/year investment on urban infrastructure development and Pradhan Mantri Kaushal Vikas Yojana 4.0 that will further fuel economic growth and empower our youth.

Highlighting the relevance and role of digitization, Gautam Chopra, founder, and CEO, BeatO said, “The setting up of 157 new nursing colleges is a huge step towards meeting the ever growing demand for providing care through paramedical staff. However, for care to reach those who really need it, it is imperative that they can leverage simple and affordable digital technology, which will help them reach the masses and serve them more efficiently. Integrating this initiative with the Ayushman Bharat Digital Mission will be key to delivering services to the last mile.”

He further added that Indian pharmaceuticals are known across the world for giving us cost-effective drugs, but we still lack innovation in new drugs, molecules, and therapies. More support and allocation of resources for health-tech start-ups to become effective would have been appreciated, as well as integration of digital solutions by such startups within the public health system would help them take their products and services further and reduce the burden on the system.

In last year’s Budget, the government proposed providing up to Rs. 2,000 crore as venture capital to create an ecosystem for health-tech start-ups to help them access capital and develop innovative products and services but we haven’t seen concrete steps followed in the deployment.

Echoing similar views, Dr. Tarang Gianchandani, CEO of Sir HN Reliance Foundation Hospital on the “Union Budget 2023”, “The emphasis of the budget on digitization, with increased focus towards modern tech would ensure speedier adoption of digital tools and enhanced research in AI. Investment towards nursing colleges is a progressive move as that is the need of the hour. Infact public private partnerships (PPP) would be encouraged to ensure the government can get adequate support from private players and we as a sector are able to come up with setting up these nursing colleges sooner. With digital transformation play and focus on R&D in the budget, it will be encouraged if every tertiary and quaternary healthcare facility can have a R&D division focused on advancement in pharmaceuticals, biomedical equipment as well as medical consumable to further enhance healthcare output for patients in terms of quality, safety and cost.”

Private labs can work in partnership with Indian Council of Medical Research (ICMR) to work towards this objective and work in unison for better healthcare productivity and efficiency.

Highlighting the role of medical tourism, Shaaz Mehmood, director, and promoter of Medijourn, a Medical Value Travel company with Apollo as their strategic partner said, “India is at a key inflexion point of not just 'Heal in India', through its vibrant medical value tourism policies and initiatives, but also 'Heal by India', where our medical professionals can be engaged to serve not just our nation but also at a global level. The noble initiative to add 50 new tourist destinations will certainly have a multiplier effect on the medical value tourism (MVT) sector. If the subsidiary with Exim Bank is leveraged well, it will hugely benefit the medical travelers who struggle with the foreign exchange logistics."

According to Joy Chakraborty, COO, PD Hinduja Hospital, “The increased focus on medical education through setting up of new nursing colleges and multidisciplinary courses for medical devices is a welcome move. This will help in improving our nurse-to-patient ratio and also add to the resource pool of skilled healthcare technicians. India is moving towards increased adoption of technology in healthcare and the creation of an AI-based centre of excellence for healthcare will be fruitful in accelerating this trend. The focus on R&D in drugs and pharmaceuticals has the potential to spur innovation, making India a global leader in this field. “

He further added, “The mission to eliminate sickle anemia is laudable and much needed for the country. This program can play a critical role in the development and implementation of future programs focused on the prevention and management of non-communicable diseases that are expected to contribute more than 75% of India's burden by 2025. Focus on green growth and urban sanitization are good preventive measures to improve the overall health of the people. Since Tourism is given importance, hopefully the medical value tourism will also get some boost in its business. However, the industry was expecting a lot more in terms of tax incentives and exemptions, health insurance coverage to reduce the overall cost of healthcare for the patients along with increased exemption for preventive health check-ups.

Gautam Khanna, CEO P.D. Hinduja Hospital & chairman FICCI Health Services said, “Budget 2023-24 focused on enhancing India’s capabilities and resources through increased manpower, R&D, and PPP in the healthcare sector. Setting up of 157 new nursing colleges is welcome, in view of the severe shortage of nurses in the country. However the current state of existing nursing colleges must be evaluated for upgradation and better job opportunities for nurses to be identified to curb international migration. The idea of setting up a Center of Excellence in AI for health along with the strengthened impetus towards medical education will accelerate the development of new-age, technology-driven medical solutions for better disease management and encourage start-ups to come up with Innovative solutions in the healthcare delivery space.”

He further added that creating awareness of prevention and early screening is not only essential in eliminating sickle cell anemia but would also be a great stepping stone for similar diseases , however its success will depend on effective implementation. The increased focus on encouraging medical education and PPP will aid the industry’s growth.

“The budgeted increase in healthcare expenditure of 15% does not seem enough to tide over the current challenges of upgradation of infrastructure and providing accessibility and affordability for quality healthcare in the country.  We are looking forward to clear indications of the steps to be implemented for healthcare infrastructure development and move closer towards universal health coverage with increased expenditure as a % to GDP. It would have been better if there were tax exemptions for healthcare, which is vital to reduce healthcare expenses out of pocket spending,” Gautam Khanna concluded.

“FM announced a new programme for research in pharmaceuticals which will be formulated and the industry will be encouraged to invest in research. Post the pandemic, many of the world’s manufacturing bases are still grappling with the devastation of healthcare systems and the announcement is a step in the right direction to establish India as the research hub of the world. This will encourage more and more pharma companies to invest in research and deliver better products. The Budget also accommodates dedicated multidisciplinary courses for the medical devices sector. This should help rural medical services to catch up with the rest of India. While these are positive announcements, the industry was also expecting tax benefits like reduced GST rate on research activities, special allocations, tax concessions, incentives and grants so that the overall industry gets a boost and establishes India’s importance in the world,” said Abha Damani, director, ICPA Health Products Ltd (ICPA).

With the fields of education and healthcare, the cornerstones of our outreach, significantly addressed in the Union Budget 2023, Shaina Ganapathy, head of community outreach, Embassy Group said, “After nearly three years of disruptions caused by the Covid-19 pandemic, the education budget crossed Rs. 1 lakh crores last year. With the shift towards digital learning, an expansion of digital infrastructure that is inclusive in nature is much needed in the upcoming year. Therefore, it’s great to hear that a National Digital Library for children and adolescents will be set up, which makes available books across geographies, languages, learning-levels, and more. States will also be encouraged to set up physical libraries and provide technology to access the National Digital Library Resources. Additionally, to bridge pandemic-induced learning gaps, as well as build a culture of reading, the National Book Trust, the Children's Book Trust, and other sources will be encouraged to provide noncurricular titles in regional languages and English to these physical libraries.”

“Considering the drastic shortage of teachers in government and rural tribal schools across the nation, we are pleased to note that in the next 3 years, the Centre will recruit 38,800 teachers and support staff for the 740 Ekalavya schools serving 3.5 lakh tribal students. EMRS has had their budget increase by a significant Rs. 581.96 crore to Rs. 2,000 crore for the 2022–23 financial year. Supporting residential schools run for tribal students, this scheme will go a long way towards enabling a holistic tribal education system in the country. Teachers will be vital towards recognising tribal cultures, languages, curriculums and unleashing their inherent learning ability,” Shaina Ganapathy added.
While sharing his views, Vinod Nair, global VP of sales and general manager Noventiq India said, “In recent budgets, India’s government has shown itself to be both imaginative and effective when it comes to deploying policies and incentives which will continue to attract innovators and incentivise them to draw on India’s spectacular talent pools. Of course, these have mostly been life-support measures to help those companies which took a hit during the Covid-19 pandemic, but, this year, we can expect more positive incentives, aimed at encouraging foreign investment, and creating a business-friendly environment which will propel the startup ecosystem on to new heights.”

Sharing his views, Vikas Jain, co-founder, PLAY Design Labs said “A very sensible budget presentation and the FM has been considerate to the common man and industry alike. There is massive commitment of job creation and infrastructure spending which is very well received for India. Most of the industry is well taken care of and focus on strengthening manufacturing is evident. We hope to see some focus and action on the “cost of capital” in future budgets and themes. Backing manufacturing by incentivizing R&D/design could have been a great addition and we remain hopeful for outlay for design in the forthcoming edition.”

According to Jesal Doshi, deputy CEO, B Medical Systems, “The #Budget2023-24 acknowledges and supports the healthcare sector. To show how seriously the administration is taking its stated objective of allocating 2.5% of GDP for health by 2025, the budget allocation for FY24 will be crucial. The budget also stated that specific facilities at a few ICMR labs will be made available for research by academics from public and private medical colleges as well as R&D teams from the private sector to promote joint research and innovation. We believe initiatives like these will strengthen the healthcare industry and further foster a culture of sustainable innovation in India. “
Aakrit Vaish, CEO and co-founder at Haptik said, “With the implementation of 5G, the government has made it their mission to establish a Center of Excellence in Artificial Intelligence. By creating this hub for technological innovation we can continue to propel our nation forward into new heights! The budget presents a comprehensive analysis of the potential uses of artificial intelligence (AI) to bolster India's economy, and outlines numerous applications for this revolutionary technology. 100 laboratories will be established in engineering colleges across the nation so as to generate AI-based 5G services; likewise, three Centres of Excellence for Artificial Intelligence are slated to open up at top educational institutions.”

Talking about the ambitious schemes announced by the government to boost all critical segments, Vineet Agarwal, MD at Transport Corporation of India Ltd, “For the Logistics Sector, a committed focus on all tenets under NLP, will definitely lead the country from recovery to resurgence. The increased Capital Outlay for critical Infra projects under the "Inclusive Development" priority will further boost sectoral development. The steep investment increment in digitization and automation to develop smart warehousing, and an announcement of 100 critical transport infra projects for steel, ports, rail and road will strengthen the much-needed multimodal connectivity. Provisions like coastal shipping with Viability Gap Funding (VGF) for people & freight movement will further facilitate seamless cargo movement while reducing logistics costs.

Sujit Patel, Founder and CEO, SCS Tech said, “As the nation advances to the next level of technology and with the introduction of 5G, the government has expansive plans to establish a Centre of Excellence in Artificial Intelligence. India will transition to a digital society and for that, it becomes important to focus on digital transformation and cyber security solutions. The budget report evaluates how AI will be used to boost India's economy, along with proposals for numerous fields where AI can be deployed. Not only this will increase the effectiveness and productivity of the industry but also optimize the process to complete the tasks.”


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