In a significant setback for the Pharmaceutical and Life Sciences sector in Telangana, the Revanth Reddy government has officially decided to scrap the Hyderabad Pharma City project. Industries Minister D Sridhar Babu announced the Congress government’s decision at the Bio Asia summit in Hyderabad.
This hasty decision by the Congress government has shocked the pharma sector, especially as the scrapping coincides with BioAsia, a flagship conference of the biotech and pharma industry. Although the government has proposed an alternative plan to set up pharma clusters in various locations in the state, it appears to be unviable.
Unfortunately, the Congress government’s ill-conceived move to scrap a project that had already made headway will likely lead to the shifting of the pharma capital from Telangana. The previous government had worked diligently to make Hyderabad Pharma City, an integrated ecosystem, a reality. The facility is environmentally clean with Zero Liquid Discharge, and plans were in place to relocate all polluting pharma companies within Hyderabad to this Pharma City.
Despite several hurdles over the years, the BRS government had convinced local youth and farmers to gradually pool the land required for this prestigious project. Many global companies had already shown interest in operating from the facility, and the Congress’s decision will significantly impact investor confidence and portray the state in a negative light.
Additionally, pharma companies in Telangana are reportedly contemplating relocating to Uttar Pradesh since the Hyderabad Pharma City project in the state has been put on hold. The Uttar Pradesh (UP) government is actively wooing major pharma companies in the state to shift their bases to a special industrial corridor in Lalitpur, UP.
Telangana is also facing stiff competition from the proposed bulk drug park in Andhra Pradesh. The Revanth Reddy government’s indifference towards the pharma sector has reportedly led over 70 pharmaceutical companies, initially interested in investing in Telangana, to explore opportunities in states like Uttar Pradesh and Andhra Pradesh.
Envisaged on the concept of work, live, learn, and play, Hyderabad Pharma City was supposed to offer an integrated cluster and benefits through the economy of scale, helping cost optimization for tenant industries. This establishment was conceptualized, including bulk drug manufacturing facilities, R&D centers, incubation hubs, a university, residential and social infrastructure, warehouses, allied and ancillary units, etc. In a proposed area of 19,000 acres, the environmentally cleared cluster has an investment potential of USD 9.7 billion, with the potential to generate over 5 lakh direct jobs.
1/3rd of the global vaccines are produced in Telangana, 50% of India’s bulk drug exports are from Telangana, 40% of India’s bulk drug production are from Telangana. In the last two years, the life sciences sector in Telangana has grown at the rate of 23% while the national average has been around 14%. These facts and figures elucidate how Telangana has emerged as a life sciences and pharma hub in the last 9+ years during the BRS rule under the leadership of KCR.