India Liberalizes Foreign Investments But Will The Money Flow?
India has eased foreign direct investment (FDI) norms in the pharmaceutical sector – reforms that are expected to buoy foreign capital inflows and investor sentiment, especially private equity, though some opponents claim it may potentially have a dire impact on India's future medicines security.
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The Indian pharma foreign direct investment (FDI) debate – something of a dormant volcano – erupted again toward the fag end of 2014, after a Parliamentary panel took a tough view on such inflows in the case of brownfield deals, only to be followed by reports of the finance ministry seemingly singing a different tune.
India has diluted the rider concerning non-compete clauses in brownfield foreign direct investment (FDI) proposals, a move that has evoked mixed responses with some industry experts suggesting that it opens the door to discretionary decision-making and reflects an absence of clear policy outlook.
An Indian Parliamentary panel has recommended a "blanket ban" on foreign direct investment (FDI) in brownfield pharmaceutical projects in the country, claiming "danger" to health and intellectual property rights aspects arising from such investments including access and affordability of medicines, as well as the "elbowing" out of the domestic industry and undue pressures on TRIPS arrangements.