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Implementation of the Pharmaceutical Technology Upgradation Assistance Scheme (PTUAS), launched by the Department of Pharmaceuticals (DoP) in 2022, is proving to be a thorn in flesh of the Department as there are few takers for the scheme due to several unattractive features. The scheme was targeted for the MSME units in the pharmaceutical sector to upgrade their manufacturing facilities as per WHO-GMP standards or Schedule M standards. The purpose of the scheme was to make the MSMEs self-reliant and at par with global standards by supporting technological upgradation. It was a credit linked scheme which provides financial support of up to Rs. 1 crore to a pharma MSME aspiring to upgrade its manufacturing facility as per WHO-GMP standards. It was among the three sub-schemes of 'Strengthening Pharmaceuticals Industry' (SPI) to strengthen pharma MSMEs in the country. Initially, the scheme had provisions for a capital subsidy of 10 per cent on loans up to a maximum limit of Rs. 10 crore with a minimum repayment period of three years or interest subvention of up to 5 per cent (6 per cent in case of units owned by SC/ST) on reducing balance basis. Minimum repayment period of the loan sanctioned for availing of the benefit under the scheme was 3 years. But the scheme did not go down well with the MSME units as there were several lacunae in the scheme. Normally any capital subsidy scheme benefit is minimum 20 per cent subsidy, but in the case of PTUAS it was only 10 per cent. Besides, the repayment period was only 3 years. Any capital investment required minimum 7 years repayment.
As the scheme did not elicit much response, the DoP revamped the scheme several times during the last four years, making it attractive to the MSMEs. After the initial guidelines issued on March 11, 2022, the DoP modified it in July, 2022 and January, 2023. Then on March 11, 2024, the PTUAS was revised and renamed as RPTUAS with a view to increase the uptake and to help the pharmaceutical industry align its production process with best global standards. The objective of the RPTUAS was to facilitate the existing pharma units to upgrade to Revised Schedule M and WHO-GMP standards. The intended beneficiaries would include existing pharmaceutical manufacturing units having turnover of less than Rs. 500 crore over the last three years. Then again, the scheme did not go down well with the industry. Naturally, the fund utilisation earmarked for the scheme has been far and few between which caught the attention of the Parliamentary panel. The panel has recently expressed concern over the lackadaisical attitude of the DoP in utilising the funds earmarked for the Scheme. Taking note of the fact that no actual expenditure has been incurred under the RPTUAS so far, the panel has now recommended to the DoP to take urgent measures to ensure that the funds are transferred to the eligible MSME pharmaceutical units in a time-bound manner. The Financial outlay for the scheme is Rs. 300.10 crore for the period financial year 2021-22 to 2025-26. The panel noted that despite Budget Estimates allocation of Rs. 95 crore in 2023–24, Rs. 5 crore in 2024–25 and Rs. 100 crore in 2025–26, no actual expenditure has been incurred under the Scheme so far. Close on the heels of the panel’s adverse observations, the DoP has once again revised the Scheme modifying the norms related to claiming the first instalment of the subsidy and submission of manufacturing standards certificates for shortlisting of applicants under the sub-scheme. If need be, the DoP should further liberalise the modalities of the implementation of the scheme as several MSMEs are in dire need of funds to upgrade their units as per the Revised Schedule M.
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