Large generic drug makers and financial investors such as private equity funds may also be interested. Picture: Representational ImageReuters

National Security Adviser (NSA) Ajit Doval says India's overdependence on China for sourcing raw material for drugs is not an ideal situation, adding that the country risks a severe shortage of medicine because of it.

India should become self-sufficient in manufacturing the essential medicines and take immediate steps to create adequate infrastructure for the same, said Doval.

"The national security adviser had highlighted concerns related to overdependence on China for supply of active pharmaceutical ingredient (API). Following this, a core committee of experts was formed under the health ministry and a policy would soon be finalised to boost domestic manufacturing of bulk drugs used in medicine formulations," a senior official in the government told TOI.

As things stand now, India imports over 80-85% raw material used in medicines, from China. The cause for concern is that any kind of tension between the two countries has the potential to lead to a crisis in public health in India. China has got on the wrong side of many of its neighbours in the past and India should take a call based on its economic and strategic relationship with the country, say experts.

The Chinese government had blocked exports to Japan of a crucial category of minerals used in products like hybrid cars, wind turbines and guided missiles, when the two nations were not on the best of terms in 2010.

The Prime Minister's Office (PMO) as well as the health ministry had taken cognizance of the issue. The government is set to roll out a separate policy to revive the domestic API manufacturing industry. "The committee and task force set up by the government for preparing the policy have finalised their recommendations and gone to the PMO," the official said.

The proposed policy will address the concerns of bulk drug manufacturing by way of incentives and creating infrastructure through bulk drug parks, etc. The proposal will also evaluate other issues related to anti-dumping duties and environmental clearances.

India has been outdone by China as a favoured destination for sourcing low-cost, good quality raw material for manufacturing medicines. Creating of huge capacities has led to China dominating the bulk drug market globally in the past few years.