Future of MP Pharma lies in quality manufacturing, exports and contract development 

Madhya Pradesh is steadily emerging as a pharma manufacturing hub. How do you assess the current growth trajectory of the state’s pharma MSME sector? 

Madhya Pradesh has witnessed significant growth in pharma manufacturing over the last decade, particularly in and around Indore-Pithampur, which has emerged as the state’s strongest pharma ecosystem. The state offers a strategic central location, comparatively lower operating costs, availability of industrial land, and a supportive manufacturing environment. 

The pharma cluster around Indore-Pithampur today houses a large number of formulation, API, herbal, nutraceutical, and contract manufacturing units, ranging from MSMEs to globally regulated facilities. The presence of major companies alongside hundreds of MSME units has created a strong industrial ecosystem, generating employment and supporting ancillary industries. 

From an MSME perspective, there is increasing investment in quality systems, export readiness, and product diversification. The sector is moving from being primarily a domestic supplier to becoming an important contributor to regulated and semi-regulated international markets. 

How important is the Pithampur pharma cluster in positioning Madhya Pradesh as a preferred manufacturing destination? 

Pithampur is undoubtedly the backbone of Madhya Pradesh’s pharma manufacturing sector. It has developed into one of India’s important pharma production centres, with the presence of domestic and multinational companies manufacturing for both Indian and international markets. 

The cluster provides economies of scale, availability of skilled manpower, logistics advantages, supplier networks, packaging support, engineering services, and regulatory expertise. It has also enhanced investor confidence in Madhya Pradesh as a reliable manufacturing destination. 

The upcoming infrastructure developments, including improved connectivity and industrial corridors, are expected to further strengthen Pithampur’s position in the coming years. 

What are the biggest challenges currently faced by small and medium drug manufacturers in Madhya Pradesh? 

The biggest challenge remains cost competitiveness. MSME manufacturers are facing rising costs of raw materials, packaging materials, utilities, logistics, and skilled manpower. Working capital pressure has also increased due to delayed payments from institutional buyers and government procurement agencies. 

Another challenge is maintaining profitability while complying with increasingly stringent regulatory requirements. Smaller manufacturers often operate with limited financial resources, making investments in technology upgrades, automation, validation, and documentation systems difficult. 

Availability of trained technical manpower, particularly in quality assurance, regulatory affairs, and validation functions, is also becoming a concern for many MSME units. 

What kind of policy support or incentives are most urgently needed to strengthen the pharma manufacturing ecosystem in the state? 

The sector would benefit significantly from dedicated support for Schedule M compliance, technology modernisation, and infrastructure upgrades. Interest subsidies, capital investment subsidies, and low-cost financing mechanisms can help MSMEs transition smoothly to higher quality standards. 

The government should also strengthen common facilities such as advanced testing laboratories, stability chambers, training centres, and regulatory support cells that can be shared by smaller manufacturers. 

Faster reimbursement of industrial incentives, prompt payment mechanisms in government procurement, and export promotion initiatives would further improve the competitiveness of MSME pharma companies. 

The revised Schedule M guidelines are expected to significantly impact manufacturing practices. How prepared are MSME pharma companies in Madhya Pradesh to comply with the new requirements? 

The industry understands the importance of revised Schedule M because it will strengthen product quality, patient safety, and global acceptance of Indian medicines. Many medium sized companies have already initiated infrastructure improvements, documentation upgrades, training programmes, and quality system enhancements.

However, preparedness varies significantly across the MSME segment. While some units have made substantial progress, smaller companies are still assessing the investments required for full compliance. The intent to comply is strong, but implementation timelines and financial capability remain important factors. 

What are the major concerns of smaller manufacturers regarding Schedule M implementation, especially in terms of infrastructure upgrades and compliance costs? 

The primary concern is the substantial capital expenditure required for facility modifications, HVAC systems, water systems, equipment qualification, computerised documentation, and validation activities. 

For many MSMEs, these investments can run into several crores of rupees. In addition to infrastructure costs, there are recurring expenses related to training, documentation, audits, consultants, and quality management systems. Most small manufacturers are not opposed to quality improvements; their concern is ensuring that compliance requirements are implemented in a practical manner with adequate transition time and financial support. 

Are MSME pharma companies in MP increasingly exploring opportunities in exports, nutraceuticals, and contract manufacturing? 

Yes, this trend is clearly visible. MSME companies are actively exploring export opportunities in Africa, Asia, Latin America, and other emerging markets. Many companies are also diversifying into nutraceuticals, wellness products, herbal formulations, and food supplements due to growing consumer demand. 

Contract manufacturing and third-party manufacturing have become important growth drivers. Brand owners increasingly prefer asset-light models, creating opportunities for quality-focused manufacturing companies. This shift is helping MSMEs improve capacity utilisation and expand their business beyond traditional markets. 

Looking ahead, what is your vision for the growth of Madhya Pradesh’s pharma MSME sector over the next five to ten years? 

Madhya Pradesh has emerged as one of the most attractive destinations for pharma manufacturing in India. The State Government’s industrial and MSME policies offer a strong combination of capital incentives, infrastructure support, and ease of doing business. 

Under the latest industrial promotion and MSME policies, pharma and medical device manufacturing units are eligible for substantial capital assistance on investments in land development, buildings, plant and machinery, along with interest subsidies on term loans. In several cases, incentives can range from approximately 40 per cent to over 50 per cent of eligible investments, particularly for priority sectors and MSME units. The state also provides support for laboratory infrastructure, quality certifications, and export oriented initiatives. 

Apart from financial incentives, Madhya Pradesh offers competitively priced industrial land, excellent road connectivity through national corridors, reliable power availability, and abundant water resources, which are critical for pharma manufacturing operations. The development of industrial ecosystems such as Pithampur, Indore, and Mandideep has further strengthened the state’s attractiveness for investors. Recent government initiatives to expand industrial land banks and improve logistics infrastructure are expected to accelerate industrial growth even further. 

As a result, Madhya Pradesh is witnessing growing investment interest from leading pharma companies as well as small and medium-sized manufacturers across the country. The combination of investor-friendly policies, strategic location, lower operating costs, and strong infrastructure is positioning the state as a preferred destination for pharma manufacturing and healthcare-related industries. 

I believe Madhya Pradesh has the potential to become one of India’s leading pharma manufacturing states over the next decade. The combination of strong industrial infrastructure, strategic location, expanding pharma clusters, and supportive policies creates a strong foundation for growth. 

My vision is to see Madhya Pradesh emerge as a centre for quality pharma manufacturing, exports, nutraceutical production, and contract development and manufacturing services. With continued government support, successful implementation of quality standards, and investment in innovation and skill development, the state’s pharma MSME sector can significantly increase its contribution to employment, exports, and healthcare manufacturing.

Pithampur hosts manufacturing facilities of leading companies such as Cipla, Lupin, Glenmark, Torrent, Alkem, Aurobindo and others, making it one of Central India’s most important pharma manufacturing hubs. 

swati.rana@expressindia.com
swatirana.express@gmail.com 

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