FDI Equity Inflow into Pharma Sector registers Growth of 45% in FY 23 to cross $2 Billion Mark

The Foreign Direct Investment (FDI) equity inflow into the pharmaceutical industry has registered a growth of 45.4 per cent in the fiscal year ended March, 2023, as compared to the inflow in the previous fiscal year. The foreign equity investment has crossed $2 billion during the fiscal year, according to official data. The FDI investment into the drugs and pharmaceuticals sector during the financial year 2022-23 was $2.05 billion, as compared to $1.41 billion reported in the previous fiscal year.

The growth comes after a decline of five per cent registered in the fiscal year 2021-22 as compared to the $1.49 billion foreign equity infusion in the year 2020-21, according to data from the Union ministry of commerce and industry. The cumulative FDI inflow from April 2000 to March, 2023, stood at $21.46 billion, holding the eight position among the sectors attracting highest FDI equity inflow in the country, which is led by the services sector at $631.98 billion. The FDI inflow into the sector has reported a significant growth while the overall FDI equity inflow to the country reported a 22 per cent decline during the fiscal year 2022-23.

The FDI equity infusion during the last quarter of the financial year, ending March, 2023, reported a growth of 14 per cent at $240 million as compared to the $210 million registered during the same period of previous fiscal year. The hospital and diagnostic centres sector has reported a growth of 16.2 per cent during the fiscal year 2022-23, at $810 million fund infusion, as compared to $697 million inflow reported in 2021-22. The cumulative FDI equity inflow into the sector stood at $8.73 billion from April, 2022 to the end of March, 2023, growing from $7.92 billion reported at the end of March, 2022. Foreign investments in pharmaceuticals in greenfield projects are allowed up to 100 per cent under the automatic route and for brownfield pharmaceutical projects, foreign investment beyond 74 per cent to up to 100 per cent, government approval is required.