India's medical device imports are expected to cross Rs 1 lakh crore this year, raising concerns over the country's continued dependence on overseas technology despite the push to promote domestic manufacturing under the ‘Make in India’ initiative.
Industry representatives say low import duties, regulatory delays and competition from Chinese manufacturers are making it difficult for Indian companies to build indigenous manufacturing capabilities.
The growing import bill has brought the gap between policy intent and implementation into focus, with manufacturers calling for a level playing field, faster regulatory approvals and incentives for technology development.
Vishwaprasad Alva, Founder and Managing Director of Skanray Technologies, a Mysuru-based company with its European operations centred in Bologna, Italy, pointed to the challenges faced by companies investing in research, development and manufacturing in India, even as the government promotes its ‘Go Local, Go Vocal’ campaign.
He also minced no words in citing delays in regulatory approvals, an inverted duty structure and the absence of reciprocal tariffs as key issues affecting domestic manufacturers and exporters.
Alva also questioned the ease with which finished devices and semi-finished kits could enter the Indian market, while companies investing in core research and engineering continued to face operational hurdles.
"While imports of finished goods and kits are becoming easier for traders and assemblers, core R&D and manufacturing companies are struggling with inordinate delays in responses and approvals from regulatory bodies. Correction of the inverted duty structure and application of reciprocal tariffs are also pending," Alva said.
He argued that restricting Chinese investment while allowing imports from the country to grow could prove counterproductive. Instead, India could consider permitting Chinese companies to invest in greenfield manufacturing projects or acquire Indian companies, subject to conditions that ensure a specified share of core R&D and engineering remains in India, suggested the head of Skanray Technologies, a major medical R&D and manufacturing firm exporting FDA-approved and CE-marked devices to over 80 countries.
"The tendering process is also opaque. Dumping is rampant in the private sector as well," Alva said, calling for greater engagement between policymakers and industry.
A parliamentary panel too recently in its report has flagged the practice of importing components and accessories, particularly from China, and undertaking limited assembly in India before marketing the products as domestically manufactured. The panel has called for stricter verification of claims of indigenous manufacturing.
Sunil Khurana, Senior Adviser at Claypond and former executive chairman of BPL Medical Technologies, pointed out low customs duties on imported medical devices, combined with China's well-established manufacturing ecosystem, were putting Indian manufacturers at a competitive disadvantage.
He asserted that customs duties on several imported medical devices were as low as 5-7.5%, making it difficult for domestic companies to compete with overseas manufacturers that benefit from established supply chains, locally available components and lower production costs.
"When import duties are so low, it becomes extremely difficult for Indian manufacturers to compete. Domestic companies are expected to invest in technology, infrastructure and manufacturing capabilities, but imported products can enter the market at relatively low costs. This does not create a level playing field," he said.
Khurana, who has over four decades of experience in the medical technology industry, advocated increasing customs duties on imported medical devices to around 15-20%, particularly in the electronic medical equipment segment, until India develops a stronger semiconductor and electronics component ecosystem. He cited linear accelerators, which attract customs duties of around 21%, as an example of how calibrated tariffs could provide support to domestic manufacturing.
Khurana said China's advantage extended beyond cheaper labour to its ability to manufacture electronic components locally and source them at competitive prices. This helped its companies keep production costs low across sophisticated equipment such as CT scanners, MRI machines, X-ray systems, ultrasound equipment, ventilators and anaesthesia machines. Improvements in productivity had further strengthened their price competitiveness.
Another concern, he said, was the import of almost-complete medical devices in the form of components or semi-finished kits, followed by limited assembly in India. Such products are sometimes marketed as locally manufactured despite minimal domestic value addition.
"What we are seeing in many cases is screwdriver technology. Companies import almost the entire product, assemble the components here and call it Make in India. The actual value addition is minimal, sometimes limited to a cabinet, sheet metal enclosure or basic assembly. The critical technology and electronics still come from outside," he said.
To encourage genuine manufacturing, Khurana proposed a differentiated GST structure, with a 5% rate for products having more than 30% domestic content, against 12% for imported products or those merely assembled in India with limited local value addition. Such a structure, he said, would encourage companies to source more components locally and invest in domestic manufacturing capabilities.
Drawing on his experience across the global and Indian MedTech, Khurana called for export incentives over three to five years to help Indian manufacturers scale up and compete internationally. India, he said, could emerge as a credible alternative to China under the China+1 strategy, provided it offered competitive input costs, policy stability and a stronger domestic supply chain.
"China has built a strong manufacturing ecosystem, supported by competitive input costs and export incentives. Indian manufacturers need a comparable enabling environment to compete in international markets. If the government provides targeted export incentives for three to five years, it can help Indian companies scale up, improve cost competitiveness and establish themselves in global markets," he explained.
However, Khurana cautioned that tariff protection alone would not address the sector's technological shortcomings. Developing sophisticated medical devices from scratch could take three to five years or longer, delaying the entry of Indian companies into high-value segments.
He suggested that the government incentivise technology acquisition through buyouts, licensing arrangements and strategic transfers, allowing domestic manufacturers to access proven technologies and adapt them to local requirements.
“The government should recognise technology acquisition as an investment and provide appropriate subsidies or incentives," he added.
Khurana also called for substantially higher support for R&D, including indigenous product design, innovation, clinical validation and technology advancement. This, he said, would help domestic companies move beyond assembly operations and develop capabilities across critical components, electronics and finished medical devices.
Drawing a parallel with the automobile sector, Khurana called for a calibrated policy framework that encouraged local investment rather than exposing domestic manufacturers to direct competition from finished imported products without adequate support.
Rajiv Nath, convenor of the Association of Indian Medical Device Industry (AIMED), agreed with Khurana’s views. He said the scale of imports made it urgent to create a comprehensive policy framework that supports domestic investment, research and technological development.
"With medical device imports expected to exceed Rs 1 lakh crore this year, India stands at a critical juncture. The choice before us is clear: continue importing technology or create a policy ecosystem that attracts investments, builds indigenous manufacturing capacity, generates high-skilled employment, and strengthens healthcare self-reliance," he said.
Nath, the Managing Director, Hindustan Syringes & Medical Devices Ltd (HMD) too called for rationalisation of tariffs, a dedicated medical devices law, procurement preference for genuine domestic manufacturers and balanced trade margin policies to strengthen the sector.
"A supportive framework comprising these measures can transform India from a large consumer market into a global MedTech manufacturing powerhouse," he added.
