In a bid to take a final view on relaxing foreign direct investment (FDI) norms in the pharma sector, the Prime Minister Manmohan Singh is likely to formalise the pharmaceutical FDI policy guidelines at a meeting on Monday, ahead of the discussion in Parliament on foreign direct investment (FDI) in retail slated to begin on Tuesday.
Earlier, the Department of Industrial Policy and Promotion (DIPP) finalised guidelines after being asked by an inter-ministerial group headed by Additional Secretary in DEA Shaktikanta Das. The issue of relaxing FDI norms in the pharmaceutical sector has been pending for long because of differences between the Finance Ministry and DIPP.
Now it is being said that the Prime Minister will approve a framework, allowing continuous flow of foreign investment into the sector, with essential checks and balances, without compromising on the availability and price of critical medicines. The two major issues to be decided in the pharma FDI policy are how much stake a foreign company will be allowed to take in an Indian firm and the role of the Competition Commission of India in the mergers and acquisitions in the sector.
In November last year, the Government revised the policy deciding to ensure that the sector is not controlled by foreign companies after acquisition of big Indian companies which may deny availability of cheaper drugs in the domestic market.