The First Secretary N. Ramakrishnan at the Indian Embassy in the Philippines said that India wants to build a pharmaceutical manufacturing hub in the Philippines, which should be referred to as “pharma zone.” Ramakrishnan said that it would depend on the Indian pharmaceutical companies to make it happen. He added that this idea was already discussed in 2016 during a joint working group meeting.
“It’s something like Peza where you have a zone where Indian companies do their manufacturing here and cater to the Philippines and also markets outside,” The Philippine Daily Inquirer reported Ramakrishnan as saying. PEZA refers to the Philippine Economic Zone Authority, which is a government agency that establishes economic zones in the Philippines for foreign investors. “A pharma zone is a zone where Indian companies can set up manufacturing here to cater to the Philippines and also market it outside,” he added.
Awaiting response from Indian pharma companies
Indian pharmaceutical companies will have to decide as to whether it would want to invest in the Philippines to manufacture medicines, including generic drugs. India is the world's third largest pharmaceutical industry in terms of volume and world's 13th largest pharmaceutical industry by value.
The Indian manufacturer of drugs was led by Sun Pharmaceutical l Industries Limited (NSE: SUNPHARMA). Following Sun Pharmaceutical are Lupin, Ltd. and Dr. Reddy's Laboratories in terms of market capitalization.
To capture ASEAN market
India’s biggest consideration to set-up a pharma zone in the country is to capture the market of Association of Southeast Asian Nations (ASEAN). Ramakrishnan said that the Indian companies can cater to the high demand of generic drugs here in the Philippines. He also noted that the Philippines’ pharmaceutical industry has recorded $3.5 billion (P175.9 billion) in sales in 2016.
“By setting up manufacturing facilities in the Philippines, Indian companies can avail of the duty-free markets of ASEAN and EU products can benefit from significant tariff differentials if produced in the Philippines,” The Philippine Star reported Trade Undersecretary Nora Terrado as saying. She added that India is considered as one of the most important economic trade and investment partners of the Philippines.
At present, India is currently one of the top investors in the Philippines in terms of telecommunications, information technology, real estate, reprocessing of waste and human-resource development. Bilateral trade between the Philippines and India stood at $1.8 billion (P90.4 billion) in 2015 and 2016, according to the Indian Ministry of Commerce data. “India can explore opportunities in the country’s manufacturing sector,” Terrado said.
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