In a move that could significantly impact the medical device industry, the GST Council is considering a substantial reduction in tax rates for numerous medical devices. The proposed change would see the GST rate drop from the current 12% to a more favorable 5%, addressing long-standing duty-related concerns in the sector.

Upcoming GST Council Meeting

The GST Council has scheduled a crucial meeting for September 3-4 to deliberate on this proposal. If approved, this tax reduction could have far-reaching implications for companies operating in the medical device manufacturing space.

Potential Benefits for Poly Medicure

Poly Medicure , a prominent player in the medical device industry, stands to potentially benefit from this proposed tax reduction. The company, known for its wide range of medical devices and disposables, could see several positive outcomes if the GST rate is lowered:

1. Reduced Tax Burden: A decrease in GST from 12% to 5% would directly lower the tax obligations for Poly Medicure, potentially improving its profit margins.

2. Enhanced Affordability: The tax reduction might allow the company to pass on the benefits to consumers, making their medical devices more affordable and potentially increasing demand.

3. Improved Competitiveness: With reduced tax rates, Poly Medicure could potentially price its products more competitively in both domestic and international markets.

4. Potential for Growth: The more favorable tax environment could provide Poly Medicure with additional resources to invest in research, development, and expansion of its product line.

Industry-Wide Impact

While Poly Medicure is poised to benefit, the proposed GST reduction is expected to have a broader positive impact on the entire medical device industry in India. It could potentially lead to increased investments, innovation, and improved healthcare accessibility across the country.

The outcome of the upcoming GST Council meeting will be closely watched by industry stakeholders, healthcare providers, and patients alike. If implemented, this tax reduction could mark a significant step towards making medical devices more accessible and affordable in India.

Poly Medicure , a prominent player in the Indian medical device industry, is optimistic about the potential impact of proposed Goods and Services Tax (GST) reforms on the sector. Himanshu Baid, the company's Managing Director, has shared insights on how these changes could significantly influence the market dynamics for medical devices in India.

Potential GST Rate Reduction

According to Baid, the current GST structure for medical devices varies based on the nature of the product:

• 5% for life-saving items
• 12% for consumables
• 18% for equipment

The industry is anticipating a potential reduction in the GST rate for consumables from 12% to 5%. This change, if implemented, could have a substantial impact on the market.

Expected Market Impact

Baid projects that the proposed GST rate cut could lead to:

• A 6-7% reduction in product prices
• Increased demand for locally manufactured medical devices

This potential shift in pricing and demand could provide a significant boost to domestic manufacturers in the medical device sector.

Indian MedTech Market Overview

The Indian MedTech market presents a sizeable opportunity:

The healthcare sector in India has been experiencing robust growth, with an annual rate of 12-15%. Notably, there has been an increasing preference for domestically produced medical devices over the past 4-5 years.

Export Scenario and Challenges

India's medical device exports have been gaining traction:

• Exports to the US: $700 million

However, these exports may face pressure due to potential tariffs in the US market. Poly Medicure, while having a limited exposure to the US market (3-4% of total exports), is strategically planning for future growth:

• Developing new product lines for the US market
• Expected launch of these products by FY27

Diversification Strategy

To mitigate risks and capitalize on global opportunities, Poly Medicure is actively diversifying its export markets. The company is focusing on expanding its presence across:

• Europe
• Asia
• Latin America

This diversification strategy aims to reduce dependency on any single market and tap into the growing demand for medical devices worldwide.

The proposed GST reforms, if implemented, could mark a significant shift in the Indian medical device industry. For companies like Poly Medicure, it presents an opportunity to enhance their market position and contribute to the growth of domestic manufacturing in this critical sector.