Besides the Commerce and Industry Ministry, the Finance Ministry, the Health and Family Welfare Ministry and the Department of Pharmaceuticals are involved in the consultations.

FDI in medical devices sector is permitted through the government-approval route and the industry has been demanding that it be put under the automatic route, they said.

“India badly needs FDI in medical devices and equipment sector. The industry is not modern and there is no threat of mergers and acquisitions from multi-national firms as domestic companies are not big unlike drug firms. So it should not be subjected to FDI limits and other restrictions,” said a source.

Industry officials have maintained for long that in the current “restrictive regime”, no foreign investor would invest in the sector and to make the segment modern and self-dependent, the government should relax the FDI policy.

The sector currently falls under the pharmaceutical category and is accordingly subjected to FDI limits and other conditions, such as the mandatory government approvals.

India allows 100 per cent FDI in pharma sector. While FDI is permitted through automatic route in the case of greenfield investment or new venture, the Foreign Investment Promotion Board (FIPB) approval is required in the case of brownfield or existing companies. Besides, there are many other riders.

As per estimates, India imports about 70 per cent of its requirement of medical devices. The industry size is about USD 7 billion in the country.

Medical devices include wide range of products such as sutures, implants and surgical instruments.

After a spate of mergers mergers and acquisition of big domestic pharma companies by multi-national firms, government tightened the FDI policy for the sector.

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