In Covid-19 pandemic budget, vaccines & healthcare get government attention
- by By Narayanan Suresh - 01 Feb, 2021
Bangalore, 01 February 2021:
A Rs 35,000 crore funding for Covid-19 vaccination drive, a Rs 50,000 crore allocation over next five years for the proposed National Research Foundation, extension of pneumoccal vaccination program from the current 5 states to the entire country, a proposal to set up a Seaweed Park in Tamil Nadu, changing definition of small companies to those upto annual turnover of Rs 20 crore are some of the highlights of the Union Budget for 2021-22.
Here are some of the specific measures that will benefit biotechnology companies:
- The central government proposes a 137 per cent increase in the overall spends for healthcare and wellbeing ( a new term mentioned in the budget for the first time) from Rs 94,452 crore to Rs 223, 846 crore. Most of it will be spent on upgrading the public healthcare infrastructure across the country. This is the combined allocation for healthcare, health research (ICMR0, Covid-19 vaccination, drinking water and sanitation projects, Ayush ministry spends, nutrition
- The home-made Covid-19 vaccines from Serum Institute of India, Bharat Biotech and many more in the pipeline will get a major boost with the Finance Minister budgeting Rs 35,000 crore for this purpose in 2021-22 “I am committed to provide more funds if needed, “ Mrs Sitharaman asserted in her Budget speech.
- The Finance Minister has announced the extension of immunization involving pneumococcal vaccine from the current five states to the entire country. This, the government hopes, will save an extra 50,000 lives of children affected by this deadly disease across the country in a year. She mentioned specifically, the vaccine , a Made in India product. It is important to highlight that the first home-made pneumococcal vaccine, Pnuemosil, developed by Serum Institute of India, Pune, was launched by Health Minister, Dr Harsh Vardhan, on December 28, 2020. Currently, the Rs 500 crore annual market for pneumococcal vaccine is dominated by GlaxoSmithklineBeecham ( Synflorix) and Pfizer (Prevnar). Two other biotech companies, Aurobindo Pharma and Zydus Cadila are also developing this vaccine in the country.
- The concept of One Health (same infections affecting both animals and humans). The government, as per the World Health Organzation (WHO) guideline will set up a National Institute for One Health that will act also as a regional center for specialized research.
- Additional fund allocation for the National Center for Disease Control and four more regional centers of the National Institutes for Virology (NIVs) with Biosafety Level III labs will be set up.
- The Finance Minister has announced a plan to set up a Multipurpose Seaweed Park in Tamil Nadu. Why? “Seaweed is an emerging sector with potential to transform the lives of costal communities. It will provide large scale employment and additional incomes,” the Finance Minister announced.
- Last year, the government had announced the plan to set up a National Research Foundation(NRF) to oversee innovative research in identified national-priority thrust areas and also strengthen the overall research ecosystem. The Minister said the modalities of the workings of NRF has now been finalized and Rs 50,000 crore will be allotted to the Foundation over the next five years.
- Startups (including biotech startups) can now enjoy the previously-announced benefits of tax holiday and exemptions from long term capital gains tax, up to March 31, 2022.
- Biotech innovators and tech innovators would be encouraged to set up one person companies (OPCs) without any ceiling on paid up capital and revenues. Also for non-resident Indians, the residency norms has been reduced to 120 days from the earlier 182 days to incentivize them to form OPCs in our country.
- Small charitable trusts running educational institutions and hospitals will be exempt from many tax-related compliance measures if their annual revenues does not exceed Rs 5 crore. The current limit is Rs 1 crore.
The Finance Minister’s 64-page speech has many minute details about changes in customs and excise duty on a wide range of items.
With substantial increase in the allocation for healthcare (137 % more) and special funds for Covid-19 vaccination drive, the Budget for 2021-22 presented by the Finance Minister Mrs Nirmala Sitharaman on February 1 has given a boost to many segments of the biotechnology industry