China is reported to be expediting its regulatory approval process to India-manufactured drugs, as Beijing looks for new trade partners amidst a protracted trade war with the United States, reports quoting the Pharmaceuticals exports promotion council said.
Indian pharmaceutical companies have long been demanding that China quicken its regulatory approvals to allow Indian companies boost exports at a time when pricing scrutiny and regulatory troubles have hurt US sales.
With US President Donald Trump unleashing a trade war on China, India expects more trade with both countries, especially with China, with which it has a trade deficit of over $61 billion.
Indian firms are looking to fill gaps in Chinese demand for generic drugs, software, sugar and some varieties of rice, officials said. China is also reported to have offered to reduce tariffs on 8,549 types of goods from India and four other countries.
"We do feel that China is receptive at this time and it's all about making prices competitive," said a government official involved in the effort to promote trade with China. The official declined to be identified since he is not authorised to speak to the media.
While Beijing has been talking of easing import regulations, nothing has materialised so far. Pharmaceutical companies, however, see prospects of sales to China.
India dominates the world's generic drugs market, exporting $17.3 billion of drugs in the 2017-18 (April-March) year, including to the United States and the EU. But only 1 per cent of that went to China, the world's second-largest market for pharmaceuticals, industry data shows.
A Reuters report quoting Dinesh Dua, chairman of the Pharmaceuticals Export Promotion Council (Pharmexcil) asid Indian firms could expect to win licences to export to China within six months of application.
"We understand internally that Chinese authorities have issued instructions that EU-approved Indian suppliers should be granted the industrial drug licence in an expeditious manner so they can enter the Chinese market within six months," Dua said.
Many Indian drug-makers are already selling to the European Union. Swift regulatory approvals in China would allow Indian companies to boost revenue at a time when pricing scrutiny and regulatory troubles have hurt US sales.
Some of India's largest drugmakers, Sun Pharmaceutical Industries and Lupin Ltd as well as Aurobindo Pharma Ltd, have been trying for years to expand in the massive Chinese market, which is second only to the United States.
Details of Chinese moves to open up its heavily regulated pharmaceuticals sector are yet to be detailed.
India had last week cautioned China at the World Trade Organisation (WTO) that its $63-billion trade deficit with it was unsustainable and that instead of mere lip-service to bridge the gap, it should lower trade barriers to make a difference to the trade imbalance.
In its statement during China’s trade policy review at the WTO, New Delhi pointed out that Beijing needed to make serious efforts to lower trade barriers for rice, meat, pharmaceuticals and IT products from India to make a difference to the huge trade imbalance.
While noting that a protocol on rice was signed during Prime Minister Narendra Modi’s visit to China in June, the statement said nothing has progressed to facilitate rice exports to China.