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Why India still relies on China for pharma ingredients
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Why India still relies on China for pharma ingredients


2020 has proved to be an extremely challenging year for both India and China. To begin with, the two countries have been severely affected by the ongoing COVID-19 crisis. Both India and China have recorded thousands of deaths due to the pandemic. Secondly, the two countries have also been caught up in a border dispute since April. These issues have had a severe negative impact on the trade ties between the two nations, and trade volumes between the two have dipped significantly.

However, despite this negative impact, the two nations are still major trade partners. There are certain industries where India and China continue to depend on each other. One such industry is the pharmaceutical ingredients market. India remains highly dependent on Chinese raw materials to meet the demands of its pharma industry. So why must India continue to rely majorly on China for this product, despite their bad relations?


India’s Continued Reliance on China

The Indian pharma industry is one of the world’s largest pharma industry. This is because the generic drugs manufactured in India are exported all around the world. India’s ability to produce cheap yet effective medicine is highly beneficial for the less developed countries. However, it is also important to note that India does not make all the raw materials needed by its pharma industry on its own.

India sources this raw material from other nations, especially China, for two main reasons. First off, India’s chemical industry is highly underdeveloped. It lags behind other countries such as China and South Korea since India cannot produce enough raw chemicals on its own. The second reason is that since the demand for India’s drugs is so high, the local producers are not able to keep up. Therefore, India has no choice but to depend on Chinese imports.

Even though India is still heavily dependent on China for the time being, it will be interesting to see if this dependence continues. Only time will tell whether the South Asian nation manages to ramp up enough local production and reduce its reliance on China.

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