GOVERNMENT POLICIES, REFORMS & FUNDING INITIATIVES

Recent Major Announcements & Ongoing Reforms (Last 6 Months – July 2025 – January 2026)

1. PRODUCTION LINKED INCENTIVE (PLI) SCHEME FOR MEDICAL DEVICES – Execution Update

• Scheme Details:
  • Total Outlay: INR 34.20 billion
  • Performance Period: FY 2022-23 to FY 2026-27 (5 years)
  • Incentive Rate: 5% on incremental sales of domestically manufactured devices
  • Four Target Segments:
    • Cancer care & radiotherapy devices
    • Radiology & imaging equipment (CT, MRI, ultrasound, X-ray, mammography)
    • Anaesthetics & cardio-respiratory equipment
    • All implants (including implantable electronics)
• Achievement (As of September 2025):
  • 22 Greenfield manufacturing projects commissioned
  • 55+ medical devices in production (MRI scanners, CT scanners, mammography, C-arm, ultrasound, LINAC)
  • Cumulative eligible sales: INR 123.44 billion (~USD 1.48 billion)
  • Export volumes: INR 58.69 billion (~USD 705 million)
• Category B Expansion (2023): Lower investment and sales thresholds for smaller/mid-sized manufacturers
• Strategic Impact: Transition from assembly to complex manufacturing; export viability demonstrated
• Post-PLI Sustainability Question: Post-FY 2026-27, cost structures and margins sustainability need assessment
• SIDMA Relevance: CRITICAL – Direct impact on medical device manufacturing competitiveness

2. GENERAL FINANCIAL RULES (GFR) AMENDMENTS 2025 – Procurement Reforms

• Implemented: June 2025
• Key Changes to Scientific Equipment Procurement:
  • Direct Purchase Limit (No Quotations):
    • Raised from ₹1 lakh to ₹2 lakhs
    • Applicability: Scientific instruments and consumables for research
  • Purchase Committee Limit:
    • Raised from ₹10 lakhs to ₹25 lakhs (some sources cite ₹20 lakhs)
    • Applicability: Public research institutes
  • Limited Tender Enquiry (LTE) & Advertised Tenders:
    • Raised from ₹50 lakhs to ₹1 crore
  • Global Tender Enquiry (GTE) Authority:
    • Vice Chancellors and Directors now approved to authorize GTEs up to ₹200 crores
    • Applicability: Scientific equipment and consumables only
  • Non-GeM Procurement:
    • Exemption granted for specialized research equipment
    • Directors/Vice Chancellors can bypass Government e-Marketplace (GeM) for specialized items
• Beneficiary Institutions:
  • Department of Science & Technology (DST)
  • Department of Biotechnology (DBT)
  • CSIR (Council of Scientific and Industrial Research)
  • Department of Atomic Energy (DAE)
  • DRDO, ICMR, ICAR
  • Universities and PG/Doctorate research centers
• Strategic Objective: Ease of doing research, autonomy, innovation acceleration, reduced bureaucratic delays
• SIDMA Relevance: VERY HIGH – Increased procurement freedom for R&D institutions = increased demand for lab equipment

3. CENTRAL DRUGS STANDARD CONTROL ORGANISATION (CDSCO) – Medical Device Risk Classification 2026

• Oncology Devices Classification List (January 2, 2026):
  • 77 specific oncology devices classified into 4 risk classes (A, B, C, D)
  • Effective immediately; dynamic list subject to revision
  • Encompasses surgical consumables, diagnostic tools, therapeutic systems, software/AI-based diagnostic applications, brachytherapy equipment
• Cardiovascular & Neurological Reclassification (Early 2025):
  • 553 medical devices reclassified
  • 221 placed in Class D (highest risk) category
• Software as Medical Device (SaMD) Regulation:
  • Computer vision/ML-aided cancer detection software explicitly classified as Class C (moderate-high risk)
  • Implies rigorous scrutiny comparable to active hardware devices
• Subsequent Importer Mechanism (Circular Sept 15, 2025):
  • New mechanism for registering “Subsequent Importers” of already-approved devices
  • Eliminates duplication of registration/approval process
  • Digital portal implementation for streamlined classification
• Impact: Regulatory certainty, reduced approval ambiguity, faster market entry for compliant products
• SIDMA Relevance: CRITICAL – Device manufacturers need to understand new classifications for market compliance

4. RESEARCH, DEVELOPMENT & INNOVATION (RDI) FUND – ₹1 Lakh Crore Initiative

• Launch Date: November 2025 (announced June 2025, operationalized November 2025)
• Total Corpus: ₹1 Lakh Crore (~USD 12 billion) over 6 years
  • FY 2025-26: ₹20,000 crore allocated
• Implementing Agency: Anusandhan National Research Foundation (ANRF)
• Fund Structure: Special Purpose Fund (SPF) with 2-tiered funding mechanism
• Funding Modes:
  • Long-term loans at low/nil interest rates (primary)
  • Equity investment (startups)
  • Deep-Tech Fund of Funds
  • Coverage: Up to 50% of assessed project cost for TRL 4+ projects
• Target Technology Areas:
  • AI and ML applications
  • Biotechnology & biomanufacturing
  • Semiconductors
  • Quantum computing
  • Robotics & space
  • Deep-tech manufacturing
  • Clean energy & climate action
  • Digital economy
  • Pharma & medical devices
• Objective: De-risk private sector R&D investment, bridge lab-to-market gap, facilitate commercialization
• Application Process: Fund Managers invited to apply (deadline Dec 15, 2025); NIA released Nov 3, 2025
• SIDMA Relevance: VERY HIGH – Direct funding opportunity for medical device R&D and commercialization

5. UNION BUDGET 2026 (Announced Feb 1, 2025; Ongoing Implementation):

a) Medical Device Import Tariff Proposals (AiMeD Request, January 2026):

• AiMeD Proposal for Union Budget 2026-27:
  • Raise basic customs duty from current 7.5%-10% to 10%-15%
  • Tiered structure based on export turnover:
    • Devices with ₹5-10 crore export: 7.5% BCD minimum
    • Devices with ₹10-100 crore export: 10% BCD
    • Devices with >₹100 crore export: 15% BCD (strategic healthcare security measure)
  • Components duty: Minimum 5% (rising to 7.5% after 2-3 years)
• Rationale: Protect domestic manufacturing investment, counter import competition
• Current WTO Bound Rate: 40% (significantly higher; applied rates are lower)
• Policy Space: Gap between bound and applied rates allows phased protection without WTO violation
• Counter-Arguments (MTaI Position): MNCs call for duty eases, citing cumulative tax burden reaching 30% including GST
• SIDMA Relevance: CRITICAL – Direct impact on competitive positioning of Indian manufacturers vs. imports

b) Construction Equipment Manufacturing Incentive (₹16,000-23,000 Crore Proposed):

• Focus Equipment: Tunnel Boring Machines, cranes, earthmoving equipment, concrete machinery
• Budget Allocation (Proposed): ₹16,000 crore for construction equipment; ₹7,000 crore for auto components
• Strategic Objective: Self-reliance, reduce import dependency, accelerate infrastructure projects
• Target Beneficiaries: Action Construction Equipment (ACE), BEML, other domestic manufacturers
• Expected Impact: Job creation, skills development, export opportunities (South Asia, Africa, Latin America)
• SIDMA Relevance: Moderate – Related to construction materials testing equipment manufacturing

INDUSTRY ASSOCIATION & COUNCIL EVENTS

AIMED (Association of Indian Medical Device Industry)

• 2026 Activities: Policy advocacy (tariff recommendations), partnership with Invest India
• Recent Action (Jan 2026): Submitted tariff increase proposal to Government for Union Budget 2026-27
• Network: Engaged in MedTech regulatory discussions, export promotion
• Website: aimedindia.com

FICCI Healthcare Division

• 2026 Events: Advantage Healthcare India (AHCI) 2026 (Feb 23-25) – 8th edition
• Other Initiatives: Healthcare Excellence Awards, sectoral advocacy

DCCI (Delhi Chamber of Commerce & Industry)

Participation: NCSTC 2026, Medical Fair India

Medical Committee Events: Occasional forums on medical device regulations, trade policy