Indian Drug Firms To Get Industrial Tax Benefits

Drugmakers in India are to receive a 125% tax benefit on money spent oncapital equipment for in-house R&D units recognized by the Department of Scientific and Industrial Research. The benefit has gone up 100% and takes effect under an amendment to Section 35 of the Income Tax Act.

In India's last budget, a five-year tax holiday was introduced to promote R&D, and customs duty was waived on specified goods. Further excise duty was removed on goods made using local R&D. However, only six or seven programs worth under $1 million have materialized in the past three years.