In a bid to bolster its economy, Pakistan’s pharmaceutical sector eyes a substantial leap in exports, targeting a lofty $3 billion over the next five years. This ambitious goal, however, hinges on crucial policy support and a conducive business environment, as highlighted by a prominent official.
Amid Pakistan’s quest for non-debt generating foreign exchange influx, experts assert that ramping up exports presents a viable avenue. Notably, India’s pharmaceutical exports are poised to soar to $28 billion in fiscal 2023-24, contrasting starkly with Pakistan’s modest achievement of $713 million in 2022-23.
Yet, realizing this milestone necessitates addressing formidable challenges currently impeding the sector’s growth trajectory, underscored the official.
In a candid discussion with Business Recorder, a former chairperson of the Pakistan Pharmaceutical Manufacturers Association (PPMA) accentuated the pressing need for a commercially astute drug regulatory authority and augmented government backing to bolster exports.
Critically, the official lamented the dearth of commercial acumen within the Drug Regulatory Authority (DRAP), hampering its efficacy in facilitating exports. Proposals were made to bridge this gap through collaborative efforts between DRAP, the Trade Development Authority (TDAP), and the Ministry of Commerce.
Furthermore, the official advocated for enhanced liquidity to sustain foreign endeavors and bolster the global footprint of Pakistan-made pharmaceuticals. This entails augmenting the retention rate of foreign exchange and instituting a market development assistance (MDA) system akin to India’s Pharmexil.
A pertinent technical snag throttling industry growth is the imposition of a 20% protective duty on imported Active Pharmaceutical Ingredients (APIs), intended to foster local production but inadvertently escalating manufacturing costs and eroding competitiveness in foreign markets.
To rectify this, the official advocated for incentivizing local API manufacturers instead of levying duties, stressing the imperative of a stable supply chain and reliable raw material procurement for forging enduring agreements in foreign markets.
The discourse underscores the imperative of a supportive regulatory framework and heightened government intervention to unlock Pakistan’s pharmaceutical export potential.
As Pakistan endeavors to shore up its foreign exchange reserves, the imperative of bolstering exports assumes paramount importance. Despite substantial rupee depreciation in recent years, exports have failed to commensurately surge, prompting a strategic reassessment as the nation seeks sustainable avenues for foreign exchange inflow.