Himachal Pradesh, one of the four states initially chosen to develop world-class infrastructure for medical devices under the Central government’s initiative, has decided to retract its plan for a Medical Devices Park due to feasibility issues.
Selected alongside Tamil Nadu, Uttar Pradesh, and Madhya Pradesh by the Department of Pharmaceuticals (DoP), Himachal Pradesh was part of the scheme to construct common facilities, with Rs. 30 crore already disbursed to each state as a first installment.
The selections emerged from proposals submitted by 16 states, according to the Ministry of Chemicals and Fertilisers.
The Ministry explained that the proposed park in Himachal Pradesh was hindered by financial issues stemming from the state’s budgetary constraints.
“Due to escalating costs, it became impractical for the state to realize the park within the department’s scheme framework, despite the assistance and the Rs. 30 crore allocation,” remarked Anupriya Patel, Minister of State in the Ministry of Chemicals and Fertilisers, during a Lok Sabha session.
“Consequently, the proposal to establish the Medical Devices Park at Nalagarh has been rescinded by the state,” added the Minister.
Meanwhile, civil construction in the other three states has progressed with much of the infrastructure completed. Equipment procurement is ongoing, according to the Minister.
The park was planned for 265 acres with an overall cost of Rs. 349.83 crore, and Rs. 157.64 crore designated for common infrastructure facilities. Previous reports indicated that by June, Rs. 23 crore, including state funds, had been utilized for the park.
The decision was aligned with the state’s earlier announcement to pursue the park independently and return the Rs. 30 crore from the Central government.
“Had the funds not been returned, the state would be obligated to offer land at Rs. 1 per square meter, electricity at Rs. 3 per unit, and free essential services for ten years, increasing financial strain,” stated the state government.
It noted that most devices manufactured would cater to markets beyond the state, resulting in GST-related revenue losses.
“To counter this, the state chose to self-fund the park, projecting Rs. 500 crore benefits over 5-7 years through land and resource sales. Incentives will align with the state’s industrial policy,” the statement continued.
Chief Minister Thakur Sukhvinder Singh Sukhu asserted, “Resource exploitation is unacceptable. The state’s assets belong to our people, and all measures will be taken to protect their interests. Without returning the Central funds, obligatory incentives for industrialists would strain our budget, reducing revenue. We’ve committed Rs. 74.95 crore already, prioritizing the Medical Devices Park project.”
Previously, the state also chose to independently support the Bulk Drug Park in Haroli, allocating Rs. 1,000 crore from state resources for the endeavor.
The Promotion of Medical Devices Parks scheme, greenlit on March 20, 2020, was designed to provide medical device units with top-tier infrastructure by FY 2020-2025, with a budget of Rs. 400 crore.