NEW DELHI: Raising serious concerns over disruptions and structural inefficiencies in India’s drug and medical device regulatory framework, a parliamentary standing committee has asked the Department of Health and Family Welfare (DoHFW) to pursue immediate approval of funds under the scheme for Strengthening of State Drug Regulatory System (SSDRS).
In its report reviewing the Demand for Grants for the Health Ministry, the Parliamentary Committee on Health and Family Welfare said that the SSDRS scheme, aimed at improving drug quality oversight and access to affordable medicines, has seen a sharp funding discontinuity.
According to the data, the ministry was allocated Rs 75 crore for the mission in the Budget Estimate (BE) for FY25. The Revised Estimate (RE) for the year fell to Rs 50 crore, of which Rs 48.32 crore, or 96.6 per cent, was spent.
However, while Rs 50 crore was earmarked for the scheme in BE 26, the revised allocation for the year fell to nil. Expenditure for FY26 also remained nil till January 2026. The SSDRS scheme received zero allocation as part of the Union Budget 2026-27.
“The Committee is concerned to find such an abrupt financial hiatus, resulting from procedural delays in approving the scheme’s extension and the subsequent SSDRS 2.0 proposal, threatens to derail the hard-won infrastructural gains achieved since the scheme’s inception,” the panel, headed by Rajya Sabha Member of Parliament Ram Gopal Yadav, stated.
Asked about the absence of allocation in FY26, the DoHFW said the scheme had already been extended till 31 March 2026 without additional financial outlay, following a no-objection received from the Department of Expenditure in January 2026.
“However, by that time, the RE for FY26 had already been reduced to zero,” the department stated, according to the panel’s report.
On zero allocation for FY27, the department submitted that no budgetary allocation had been made under the existing SSDRS as the scheme period had ended, and a revamped SSDRS 2.0 has been proposed with revised objectives and an outlay of Rs 496.16 crore for a period of five years (2026-27 to 2030-31).
“The proposal for SSDRS 2.0 is presently under consideration of the Department of Expenditure, and budgetary allocation for FY27 will be made subject to approval of the new scheme,” the department added.
“The committee recommends that the department pursue the immediate approval of the Rs 496.16 crore SSDRS 2.0 scheme with the Department of Expenditure,” the panel stressed.
Furthermore, the panel added that the DoHFW must explore interim financial mechanisms or supplementary grants to ensure that the 19 new and 28 upgraded state drug testing laboratories do not face operational paralysis while awaiting the formal rollout of the revamped scheme.
The report highlighted that although SSDRS 1.0 has significantly expanded testing capacity, from 57,000 to over 1.66 lakh samples annually, its effectiveness is constrained by persistent manpower shortages at the state level.
“The committee believes that state-of-the-art testing infrastructure is rendered futile without an adequate cadre of trained analysts and uncompromising enforcement mechanisms,” it added.
It added that the Risk-Based Inspection framework must be permanently institutionalised, standardised, and fully digitised across all State Drug Control offices to ensure that crackdowns on non-compliant manufacturing practices remain consistent, transparent, and data-driven nationwide.
Flagging delays and procedural inefficiencies in approvals by the Central Drugs Standard Control Organisation (CDSCO) for high-risk medical devices, the parliamentary panel has recommended that approval for all medical devices be completely decentralised to the state authorities.
Currently, state authorities regulate the manufacturing of low-risk medical devices, while the central authority oversees imports and manufacturing of high-risk medical devices.
“Centralisation with the Drug Controller General of India (DCGI) at the central level has created major bottlenecks and is the biggest hurdle in India being at the forefront of medical devices manufacturing,” the report stated.
It observed that out of 2,999 manufacturing and import applications processed, approximately 62 per cent were subjected to queries more than twice, and 253 import applications, even those possessing USFDA/CE certifications, remained pending for over 90 days.
These bottlenecks, it said, affect India’s competitiveness against competitors such as China, Vietnam, and Malaysia.
The panel also recommended establishing a dedicated facilitation cell within CDSCO to assist domestic manufacturers in navigating the Medical Device Rules (MDR) 2017, thereby reducing the delays currently attributed to pending applicant responses.
Source: Business Standard
