The Recent Coronavirus (COVID-19) Pandemic: A Review of Issues for Indian Pharmaceutical Exports

AuthorDebashis Chakraborty,Aaheli Ahmed,Ranajoy Bhattacharyya
DOI10.1177/0015732520926329
Publication Date01 Aug 2020
SubjectCommentary
The Recent Coronavirus
(COVID-19) Pandemic:
A Review of Issues for
Indian Pharmaceutical
Exports
Aaheli Ahmed,1 Debashis Chakraborty1 and
Ranajoy Bhattacharyya1
Abstract
The world today is facing a major challenge in adjusting to the adverse effects
of the Coronavirus (COVID-19) spread. Meeting the demand for several key
drugs and preventive medical supplies has emerged as major concern in many
countries. India has over the years consolidated its position as a major producer
and exporter of not only bulk drugs and formulations but also other medical
provisions and equipment. The present commentary makes an attempt to
understand the possible trade opportunities for India’s pharmaceutical sector
in light of the recent export policy interventions. An analysis of the recent
export policy adjustments reflects the evolving attitude of the country towards
domestic risk perception and commitment to support other countries. The
trade opportunities for India are analysed next with the help of select trade
indices, and it appears that there is significant scope for enhancing India’s global
competitiveness in several product groups. The evolving trends have then been
judged by exploring their plausible implications from a theoretical standpoint. It
has been concluded that in order to meet the growing world demands for these
products, India needs to enhance productivity of the upstream segments through
a rigorous policy framework.
JEL: F10, F13, I18
Commentary
1 Indian Institute of Foreign Trade, Kolkata, West Bengal, India.
Corresponding author:
Debashis Chakraborty, Indian Institute of Foreign Trade, 1583 Madurdaha, Chowbagha Road, Ward
No. 108, Borough XII, Kolkata 700107, West Bengal, India.
E-mail: debchakra@gmail.com
Foreign Trade Review
55(3) 418–435, 2020
© 2020 Indian Institute of
Foreign Trade
Reprints and permissions:
in.sagepub.com/journals-permissions-india
DOI: 10.1177/0015732520926329
journals.sagepub.com/home/ftr
Ahmed et al. 419
Keywords
COVID-19, India, pharmaceuticals, trade policy, APIs, Health and Government
Policy, competitiveness
Introduction
The world today is facing a major challenge in adjusting to the adverse effects of
the Coronavirus (COVID-19), which was first reported as an unknown ailment in
November 2019 and recognized as a threat by the cluster spread of pneumonia
in Wuhan in December 2019 (World Health Organization [WHO], 2020a). It was
soon identified that the highly contagious virus can spread through sneeze or
cough of an infected person in the vicinity or by touching eyes, nose or mouth,
after having contact with an infected person (WHO, 2020b). While initially the
nature of the disease and the associated threat was grossly underestimated,
alerted by the growing geographical spread and number of deaths, World Health
Organization (WHO) finally declared the disease as a pandemic on 11 March
2020 (WHO, 2020a). One of the major concerns over the disease is its effects
on patients with co-morbidity (e.g., hypertension, diabetes and malignancy) and
the associated poorer clinical outcomes (Guan et al., 2020). The search for a new
vaccine against COVID-19 however still remains elusive (WHO, 2020c). Given
the potential threat from exposure to infected persons as well as unconscious car-
riers, most of the countries took recourse to various combinations of restriction
on economic activities and home quarantine measures, considered crucial for
arresting the growing spread of the disease (European Centre for Disease
Prevention and Control, 2020). In absence of effective curative treatment, the
countries have also been forced to stop cross-border movements. While ‘work-
from-home’ emerged as the new normal, the concerns over a prolonged global
slowdown are growing (United Nations Conference on Trade and Development,
2020). In addition, reviving the disrupted supply chains even after the disease
can be contained would pose an enormous challenge to global economy (World
Economic Forum, 2020). In the short run, however meeting the demand for
several key drugs (e.g., hydroxychloroquine) and medical supplies (e.g., personal
protection equipment [PPE]) have emerged as major challenges (Park et al., 2020;
Zhang & Boyu, 2020).
Given the rising global demand for medicines and medical provisions (both
curative and preventive), there is a need to analyse whether India would be in a
position to cater to this development. The country has over the years emerged as
a major producer and exporter of not only bulk drugs and formulations but also
other medical supplies and provisions as well (Export–Import Bank, 2016).
Keeping note of the growing export potential and qualitative improvements in
the domestic sector, pharmaceutical industry has been selected among the key
segments in the ‘Make in India’ initiative launched in 2014, with an objective to
consolidate the competitive edge further. The performance of pharma sector has
improved considerably in the aftermath of introducing a series of policy reforms,

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