FDI in Biotechnology Sector— Fees, Procedure and Documents Required

Following are the components permitted under FDI in Biotechnology Sector:

• Greenfield Pharma
• Brownfield Pharma
• Manufacturing of Medical Devices
• Industrial Parks

Note: Brownfield Pharma is allowed up to 74% through automatic route and above 74% through government route. 100% FDI is allowed under government route in this field.

• List of names, addresses, and identification proof of all foreign collaborators of the investor company/entity
• From both investor/investee entities- Certification of Incorporation and MoA
• Copy of joint venture agreement/ shareholders agreement/technology
• Copy of downstream intimation
• Copy of relevant past FIPB/SIA/RBI joint with the current proposal
• Copy of Downstream Intimation
• An affidavit to ensure all documents are relevant
• Valuation certification approved by a certified chartered accountant
• CS Certificate
• Declaration by the Authorized Representative of the Indian Company/LLP
• Pre and post-shareholding pattern in the Indian company
• Copy of the order of the High Court on the scheme of merger/ demerger/ amalgamation (if applicable)
• FIRC/ Debit statement
• Know Your Customer (KYC)

There are conditions tapping for the procedure of FDI approval which must be understood by investors.

1. Government policy - Government schemes like Draft R&D Policy 2021, Clinical Trial Policy, Clinical Trial Policies and PLI Schemes have put India forward to become a ‘pharmacy of the world’. Under the GOBERdhan scheme initiated by the government of India to establish a circular economy.
2. Opportunities - The Department of Biotechnology has allocated ₹1,345 crore (US$ 162.7 million) funding to R&D centers. Additionally, US$ 17 Bn has been anticipated to generate by production of vaccines alone.
3. Skilled Human Capital - the large pool of human resources opens up a new window to the world for discovering innovative transformations. The massive reservoir of scientists and engineers in the country have sharply turned in the development field like environmental solutions, healthcare advancement, agricultural innovation, and national security.
4. Epidemiological Factors - sustaining new life of various variants and changing practices in daily life triggers demand for drugs and medical devices. Furthermore, due to population explosion, the patient pool is expected to grow over 20% in the next 10 years.

The benefits of FDI in biotechnology sector are listed below:

1. Exchanging knowledge and expertise in local industry - Facilitation in knowledge, expertise and best practices in the R&D centers, FDI has been taken to empower the growth of the biotechnology sector in the field of environmental solutions, healthcare, industrial biotechnology and more.
2. Empowering R&D centers - Discovering new variants of products and cross sectional experiments to procure modern methods bring out the quantum leap in every sector, empowering the R & D center of the biotechnology sector to attract foreign direct investment to India.
3. Improving sustainable yield - Biotechnology solutions in the agriculture sector enables gene engineering in growing hybrid crops, infusing desired qualities in crops which are rich in nutritional values for the consumers. Additionally, it showcase the path for growing crops in sustainable methods
4. Enhance Healthcare performance - The spirit of progress and development is central to the substantial performance of human productivity, resulting in better boosting in the growing values of the bio-economy. This sector also helps to accomplish health equity in the country such as recently discovering the use of bio-toilets with the.
5. Encourage industrial biotechnology - Biotechnology is incomplete without industrial prosperity. To execute the discovery of the biotechnology sector, the creation of products by the manufacturing industry is essential to merge together in order to generate power for a bioeconomy.

Foreign Direct Investment (FDI) in the Biotechnology sector has laid a quantum leap in the era of revolutionizing innovation powerhouse in the world. How microbial prowess can substantially change the blueprint for bringing out the bioeconomy at its pinnacle! To reduce the ineffective and puzzling formulation in finding solutions to the people’s problem, biotechnology ensures the smooth and quick solution to thought-provoking obstacles for the better health of the economy.

Several other factors to consider for investors while investing in science-driven industries sector are listed below:

• Before involving huge investments, applicants must be prerequisites to check the kind of companies the government allows them to invest in. Because investment in the stock market is volatile and may not recover your loss, leading to unwriggled investment which will not recover at the time of redemption of company loss.
• Additionally, before application applicants need to inspect and ensure that all the requisite documents are submitted online without discovering any omissions and incorrect information within the documents. FDI is largely inspired to bring investors forth along with certain advantages that benefit sectors.

Investors must also need to check eligibility criteria for buying investment in India in sectoral companies.