In a significant boost to India’s ambition of becoming a global manufacturing hub in critical sectors, the Union Government has intensified its efforts to expand domestic production of chemicals, petrochemicals, pharmaceuticals, and medical devices.
A detailed submission made by Minister of State for Chemicals and Fertilizers Anupriya Patel in the Rajya Sabha outlines a comprehensive mix of infrastructure development, targeted financial incentives, and technology-driven initiatives forming the backbone of this strategy. The Centre’s approach aligns with the broader Make in India and Atmanirbhar Bharat missions, designed to reduce India’s heavy dependence on imports for essential raw materials and intermediates, strengthen the domestic supply chain, and position the country as a competitive player in the global market.
A major component of this strategy is the development of Petroleum, Chemical and Petrochemical Investment Regions (PCPIRs), which remain central to India’s chemical manufacturing expansion. These large industrial zones are planned to attract investment through integrated, environmentally sustainable, and world-class infrastructure. Designed on a cluster-based model, PCPIRs offer shared common facilities such as utilities, logistics support, effluent treatment plants, testing laboratories, and storage systems. The intention is to create self-contained ecosystems in which large anchor industries and smaller downstream units coexist to ensure efficient supply chains and lower operational costs.
According to the Ministry, the PCPIR framework continues to be an important tool for drawing global and domestic investors into India’s rapidly expanding chemical and petrochemical sectors.
Complementing this is the Plastic Park Scheme, aimed at consolidating domestic plastic processing clusters and building strong downstream capabilities. These parks are equipped with shared facilities including tool rooms, testing centres, recycling units and logistics hubs. The central government provides financial assistance of up to 50 per cent of the project cost, capped at Rs 40 crore per park, fostering timely execution and high-quality infrastructure creation. To date, nine Plastic Parks have been approved across various states, each at different stages of development. These parks are expected to significantly enhance India’s capabilities in value-added plastic products, stimulate job creation and reduce the sector’s dependence on imports.
To further strengthen innovation and research capacity, the Ministry has set up 18 Centres of Excellence (CoEs) dedicated to polymers, plastics, chemicals and various process technologies. Established under the central petrochemicals initiative, these centres are aimed at supporting cutting-edge research, developing new materials and polymer applications, improving existing industrial processes, promoting commercialisation of innovations and reinforcing India’s long-term R&D capabilities. The government covers up to 50 per cent of the project cost, capped at ₹5 crore for each centre, making them accessible platforms for collaboration between academia, industry and research institutions. These CoEs are a significant step toward positioning India as a global hub for petrochemicals knowledge and innovation.
In the pharmaceuticals sector, the government is taking robust measures to address India’s long-standing dependence on imported Active Pharmaceutical Ingredients (APIs) and Key Starting Materials (KSMs), a concern that became more pronounced during the COVID-19 pandemic. To counter this vulnerability, three Bulk Drug Parks have been approved in Andhra Pradesh, Gujarat and Himachal Pradesh. These parks are supported by a central outlay of Rs 3,000 crore, with each park eligible for up to Rs 1,000 crore to establish essential common infrastructure such as effluent treatment plants, utilities, warehouses and solvent recovery systems. State governments are supplementing these efforts by providing capital subsidies, GST reimbursement, concessional land allotments and support for utilities and logistics. The aim is to substantially lower the cost of domestic API production while ensuring supply-chain resilience and reducing import reliance.
Parallel to bulk drugs, the government is also strengthening domestic capacity in medical devices, a sector in which India has traditionally imported nearly 75 per cent of its requirements. To reverse this trend, three Medical Device Parks are being developed in Greater Noida (Uttar Pradesh), Ujjain (Madhya Pradesh) and Kanchipuram (Tamil Nadu).
With a cumulative budget of Rs 300 crore, these parks are designed to house state-of-the-art testing labs, clean rooms, specialised research facilities and shared infrastructure. As of September 2025, land has been allotted to 194 manufacturers, construction has commenced for 34 units and common infrastructure is nearing completion. These parks are expected to significantly improve domestic production of diagnostic tools, surgical instruments and advanced medical devices, contributing to lower import dependence and strengthening India’s healthcare industrial base.
The Production Linked Incentive (PLI) schemes form a major pillar of the Centre’s efforts to strengthen domestic manufacturing. Under the PLI scheme for bulk drugs, with a financial outlay of Rs 6,940 crore, the government has facilitated the creation of production capacity for 26 key materials previously imported in large quantities. Investments of Rs 4,763 crore have already been made, resulting in cumulative sales of Rs 315 crore and import substitution valued at Rs 1,807 crore. This scheme has been crucial in breaking India’s over-reliance on foreign suppliers for essential pharmaceutical components.
Similarly, the PLI scheme for the wider pharmaceuticals sector, backed by a Rs 15,000 crore outlay, has stimulated the domestic production of 191 APIs and intermediates for the first time. Over the first three-and-a-half years of the scheme, the sector has reported cumulative sales of Rs 26,123 crore, underscoring the scale of expansion and growing global competitiveness of Indian manufacturers.
Together, these initiatives point toward a unified and ambitious strategy for expanding India’s manufacturing footprint. Minister Anupriya Patel emphasised that the combination of industrial parks, PLI incentives, research infrastructure and financial support is designed to expand India’s production base, boost exports in high-growth sectors, strengthen supply-chain resilience and reduce vulnerabilities stemming from import dependence.
The goal is to prepare India for a far more significant role in global chemical and pharmaceutical markets. With large-scale investments flowing into infrastructure and manufacturing, and with growing interest from global companies, these combined efforts mark one of the most comprehensive industrial expansions undertaken by the government in recent years.
Comments