India’s Active Pharmaceutical Ingredient (API) industry is calling for stronger policy support as manufacturers urge the government to introduce import curbs and financial assistance for Good Manufacturing Practices (GMP) upgrades in the upcoming Union Budget 2026. According to a report published on January 23, 2026, the sector is facing rising compliance costs and increasing competition from low-cost imports, particularly from China.
Rising Pressure from Imports and Compliance Costs
API manufacturers highlighted that stricter regulatory requirements under revised Schedule M norms are significantly increasing operational costs. At the same time, continued price pressure from imported APIs is impacting domestic producers’ competitiveness.
As a result, the industry is seeking targeted government intervention to ensure sustainability and growth of domestic manufacturing capabilities.
Demand for Import Restrictions and Safeguards
One of the key demands from API makers is the introduction of stricter import regulations, including anti-dumping measures and price safeguards for critical molecules. These measures are aimed at protecting domestic manufacturers from unfair pricing pressures and ensuring a level playing field.
Industry stakeholders believe that reducing dependency on imports is crucial for strengthening India’s pharmaceutical supply chain resilience, especially for essential drug components.
Need for GMP Upgrade Support
Another major concern raised on January 23, 2026, is the financial burden associated with upgrading manufacturing facilities to meet revised GMP standards. Small and medium-sized pharmaceutical companies, in particular, are facing challenges in funding these upgrades.
To address this, API manufacturers are requesting:
- Subsidies for facility modernization
- Soft loans and financial assistance
- Extended timelines for compliance implementation
These measures are expected to help companies align with global quality standards while maintaining cost competitiveness.
Push for Extended Incentives and Policy Support
The industry is also advocating for the continuation or expansion of Production Linked Incentive (PLI) schemes to support API manufacturing. Additional policy measures, such as incentives for critical drug production and export support, are being proposed to strengthen India’s position in the global pharmaceutical market.
Outlook
The developments highlighted on January 23, 2026, underscore the challenges faced by India’s API sector in balancing regulatory compliance with global competitiveness. As the Union Budget 2026 approaches, industry expectations are centered around a balanced policy framework that supports domestic manufacturing while ensuring quality and affordability.
If addressed effectively, these policy measures could play a crucial role in enhancing India’s self-reliance in APIs and reinforcing its position as a global pharmaceutical manufacturing hub.
