India’s pharmaceutical industry is witnessing remarkable growth in exports, with the sector poised to exceed its FY25 target well ahead of time.
Government data indicates that by October last year, 99 pc of the export target had already been achieved, raising expectations that the final figures will surpass initial projections.
The strong performance of India’s drug formulations and surgical businesses has been a key driver behind this impressive expansion.
According to the Directorate General of Commercial Intelligence and Statistics (DGCIS), drug formulations and biological products continue to dominate pharmaceutical exports, accounting for 75 pc of the total.
This segment has grown by 11 pc, further reinforcing India’s position as a global pharmaceutical hub.
While bulk drug exports have recorded growth in volume, their overall value has declined. Experts attribute this to a drop in prices of Active Pharmaceutical Ingredients (API) and intermediates from China.
The supply chain dynamics have impacted pricing, leading to lower revenues despite higher shipments.
The vaccine sector has faced challenges, showing a 9 pc decline due to reduced demand after the end of the Covid-19 pandemic. However, the Ayush and herbal segment has displayed resilience, growing by 13 pc.
This growth has been driven by more Indian companies adhering to good manufacturing practices, making their products more competitive in global markets.
The United States remains a crucial market for Indian pharmaceutical exports, with shipments to North America showing significant gains. Experts estimate that North America has already recorded $6.2 billion in exports, and if the current trend continues, it may reach $10 billion by March this year.
Despite issues such as back orders and drug shortages, the sector has grown by 17 pc. Analysts believe that without these challenges, growth could have been as high as 25 pc.
In Europe, the performance of Indian pharmaceutical exports has been mixed. The overall growth has remained stagnant, primarily due to weaker demand in the Netherlands and Belgium.
However, the UK has recorded an impressive 22 pc increase, while Germany has seen a moderate 6 pc growth despite facing economic recession.
The European market has already logged $3.2 billion in exports by October, and experts predict that the total for the year may exceed last year’s figure of $5.5 billion.
Africa remains another key market for Indian pharmaceutical exports, but it has shown signs of contraction. The region recorded $4 billion in exports last year, but figures have dipped by 3 pc in recent months.
Analysts believe that with political stability returning in some regions, market conditions may improve. The long-term potential remains strong, and experts predict that exports to Africa could surpass $10 billion in the future.
Russia has emerged as a potential game-changer for the industry. The ongoing geopolitical tensions have led to significant drug shortages in the country, creating a substantial opportunity for Indian pharmaceutical companies.
Analysts estimate that exports to Russia could grow by 15 pc, as many global suppliers are hesitant to send consignments due to the current conflict. This could give Indian firms an edge in filling the supply gap.
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