PLI-Driven Growth in Pharmaceuticals, Bulk Drugs and Medical Devices
The Government of India, through the Department of Pharmaceuticals under the Ministry of Chemicals & Fertilizers, has rolled out a set of Production Linked Incentive (PLI) schemes aimed at transforming India into a competitive manufacturing base for pharmaceuticals, bulk drugs and medical devices. These schemes are closely aligned with the broader policy vision of “Make in India” and “Atmanirbhar Bharat” and are designed to enhance domestic capacity, lower import reliance, foster technology advancement and reinforce supply-chain resilience across the Pharma and MedTech ecosystem.
Three key PLI initiatives are at the core of this strategy:
- PLI Scheme for promotion of domestic manufacturing of critical Key Starting Materials (KSMs)/ Drug Intermediates (DIs)/ Active Pharmaceutical Ingredients (APIs), commonly referred to as the PLI Scheme for Bulk Drugs
- PLI Scheme for Pharmaceuticals
- PLI Scheme for Promoting Domestic Manufacturing of Medical Devices
Together, these schemes cover the value chain from basic pharmaceutical building blocks to complex finished formulations and advanced medical technologies.
Strategic Objectives of the PLI Framework
The PLI schemes for the pharmaceutical and medical device sectors pursue multiple policy objectives in an integrated manner:
- Augment domestic production capacity for essential bulk drugs, high-value pharmaceutical products and sophisticated medical devices
- Reduce dependence on imports, particularly in segments where India has historically relied on overseas suppliers for APIs, intermediates or high-end equipment
- Attract substantial capital investment into greenfield and expansion projects in manufacturing
- Promote technology upgradation, including transfer of advanced know-how and adoption of state-of-the-art processes
- Strengthen supply-chain resilience by broad-basing domestic sources of critical inputs and final products
- Create employment opportunities in manufacturing, R&D and associated support services
- Enhance export competitiveness by incentivising globally competitive production at scale
The incentive is directly linked to actual production and/or incremental sales, thus anchoring the benefits in demonstrable output rather than mere capacity creation on paper.
PLI Scheme for Bulk Drugs: Building Self-Reliance in Critical Inputs
Policy Design and Financial Outlay
The PLI Scheme for Bulk Drugs was sanctioned in 2020 with a total financial commitment of ₹6,940 crore. The core purpose of this scheme is to support domestic manufacturing of 41 specifically identified critical products, covering:
- Key Starting Materials (KSMs)
- Drug Intermediates (DIs)
- Active Pharmaceutical Ingredients (APIs)
The emphasis is on products where import dependence has been acute, particularly fermentation-based and other critical raw materials required for essential medicines.
The scheme aims to:
- Encourage large investments in greenfield facilities
- Expand domestic production capabilities for vulnerable APIs/KSMs/DIs
- Reduce the risk of supply disruption for vital medicines due to external shocks
Approvals, Investments and Commissioning Status
Under this scheme:
- 48 projects have obtained approval
- As of June 2026, investments of ₹5,210.74 crore have already been made, surpassing the originally committed figure of ₹4,330 crore
- 39 projects focusing on 28 APIs/KSMs have been commissioned and commenced production
These numbers reflect not only strong industry response but also tangible progress in operationalizing new manufacturing lines.