India’s MedTech Bottleneck

India’s medical technology ambitions hinge on regulatory clarity, where fragmented frameworks must evolve into a coherent, globally aligned system to enable scale, trust and exports

Update: 2026-04-14 17:59 GMT

India stands at a pivotal moment in its medical technology journey. Over the past decade, the country has moved from near-total import dependence to the early contours of a manufacturing and innovation ecosystem. Yet, if India is to become a credible global export hub for medical devices—competitive, affordable and trusted—regulatory reform must now move from incremental adjustment to structural clarity.

The roots of today’s regulatory complexity lie in history. Medical technology in India continues to be governed under the Drugs and Cosmetics Act, 1940, a parent legislation enacted in colonial India when modern medical devices, as we know them today, simply did not exist. The term “medical device” finds no mention in that Act. Over time, to address this mismatch, policymakers, regulators and industry stakeholders worked together to frame the Medical Devices Rules, 2017, which now govern the sector.

This has resulted in a globally unusual situation: a high-technology, capital-intensive sector regulated by detailed rules that sit under an Act that does not explicitly recognise it. Pharmaceuticals, cosmetics, biologics and complex life-saving equipment such as ventilators, imaging systems and implantable devices continue to be clubbed under the same legislative umbrella. In effect, a lipstick and a CT scanner derive authority from the same law. This is not merely an academic concern; it has real consequences for speed, predictability and global credibility.

At present, the Medical Devices Rules, 2017, provide the operative framework. After an initial period of voluntary registration, the sector has moved to mandatory registration and compliance. This has brought a degree of order and visibility. But for India to compete as a global manufacturing and export base, regulatory pathways must be strengthened, harmonised and future-proofed.

Globally, medical device regulation rests on three critical layers. The first is product testing and certification. In India, this is enabled through NABL-accredited laboratories, while globally comparable benchmarks include CE certification in Europe. In principle, quality checks in Germany or India should be equivalent if standards and enforcement are aligned.

The second layer is documentation—traceability, vigilance, adverse event reporting and lifecycle management. This is the backbone of patient safety and post-market surveillance and is non-negotiable in international trade.

The third layer is site inspection and auditing, where the eligibility, training and consistency of auditors become decisive. Any weakness here undermines confidence in the entire system.

India’s challenge is not the absence of these elements, but their fragmentation. Harmonisation with international norms—without blind replication—must be the guiding principle. Institutions like AMTZ have demonstrated that Indian manufacturing can operate fully aligned with global standards across all three layers. The task now is to mainstream this approach nationally.

Regulatory overlaps further complicate the landscape. Consider imaging equipment. CT scanners fall under ionising radiation and are regulated by the Atomic Energy Regulatory Board, operating under the Atomic Energy Act, 1962. MRI systems, which use non-ionising radiation, fall outside its remit. This creates a regulatory gap within the same product family. Since AERB follows international mandates, amending its parent Act is not straightforward.

A pragmatic solution lies in regulatory coordination rather than legislative overreach. India already has a designated National Regulatory Authority in the Central Drugs Standard Control Organisation (CDSCO). With calibrated policy reform and clearer delegation, CDSCO can provide a unified pathway that reduces uncertainty while preserving safety and scientific rigour.

Why does this matter now? Because India has set itself an achievable but ambitious goal: import neutrality by 2032. Import neutrality does not mean zero imports. Even advanced manufacturing economies are not fully self-reliant—Germany remains around 30 per cent import dependent, the United States about 27 per cent, and Japan close to 36 per cent. For India, moving from nearly 100 per cent import dependence fifteen years ago to below 50 per cent within the next five to seven years would be a structural transformation of historic proportions.

Clusters matter enormously in this journey. Globally, medtech clusters exist in Boston, Cleveland, Ireland, Germany, Japan and China. What differentiates successful clusters like Andhra Pradesh Medical Technology Zone (AMTZ) is not just manufacturing capacity, but the availability of shared scientific infrastructure—test labs, validation facilities, prototyping, regulatory support and skilled manpower. These are capital-intensive assets, often running into hundreds of millions of dollars, beyond the reach of individual firms. Institutionalising such infrastructure lowers entry barriers and accelerates innovation.

Equally important is recognising that manufacturing finished products alone is not sufficient. Medical technology is a deep value-chain industry. A striking example lies in radiology. An industry worth nearly Rs 7,000 crore depends critically on detectors valued at about Rs 700 crore. Without local availability of such critical components, finished-goods manufacturers simply will not scale. Attracting value-chain providers alongside product manufacturers changes the economics of the entire ecosystem.

The second realisation has been that science must be matched by commerce. A scientific ecosystem, however sophisticated, cannot sustain itself without market access. Individual companies typically manufacture five or ten products, while a modern hospital requires hundreds. No single SME can bid for turnkey hospital projects. But a coordinated cluster like ours can aggregate supply. By pooling offerings across firms, it becomes possible to deliver comprehensive solutions—something individual manufacturers could never do alone. This shift from being merely a production enabler to also acting as a supply aggregator is what converts manufacturing capability into export readiness.

Policy support has played a catalytic role in this transition. The Production Linked Incentive scheme for medical devices has encouraged scale, while parallel investments in skills, health technology assessment, market intelligence and R&D have created a more resilient ecosystem. International engagement also matters. Alignment with global health institutions and trade networks enhances credibility and opens doors that pure manufacturing cannot.

None of this is an argument for deregulation. On the contrary, India needs stronger regulation—clearer, faster and globally aligned. A dedicated medical devices law, coherent certification pathways, auditor capacity-building and regulatory convergence with major markets would dramatically improve India’s standing. Predictable regulation reduces risk, lowers capital costs and attracts long-term investment.

If India gets this right, the outcome is not merely self-reliance. It is leadership. Affordable, high-quality medical technology produced at scale in India can serve global markets that are increasingly cost-conscious but uncompromising on safety. With regulatory reform as the keystone, India can realistically position itself as a global medtech export hub in the next 5-10 years.

Views expressed are personal. The writer is the Founder CEO and Managing Director, Andhra Pradesh Medical Technology Zone

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