Comm Min writes to PM, says pharma FDI be vetted by FIPB.

The contentious issue on which government department would have the final say in the clearance of FDI in Pharma Brownfield projects is far from over. A fortnight back the Prime Minister Office (PMO) had written to commerce minister Anand Sharma asking him to let the Competition Commission of India (CCI) vet FDI in the pharma sector. However,  Sharma wrote back strongly defending his stand on the issue, reports CNBC-TV18's Rituparna Bhuyan and Ronojoy Banerjee quoting sources.

In a letter to Prime Minister Manmohan Singh on May 18 Sharma categorically states that the CCI does not have the mandate to clear FDI in pharma. This, after the PMO wrote to Sharma on May 15 to let the CCI be the nodal body for clearing such foreign investments in Pharma Brownfield projects.

Sharma's letter categorically states that the spirit of FDI policy - which makes a distinction between Greenfield and Brownfield projects - was to ensure affordable medicines for the poor.

He also draws the pm's attention on the sudden spike in mergersand& acquisitions in the domestic pharmaceutical industry - as many as 13 in the last three years - which lends credence to the apprehensions of possible price hikes in critical drugs.

Sources say that Sharma's letter was in response to a communication that was earlier sent by health minister Ghulam Nabi Azad on April 27 where he is learnt to have said that FIPB should continue clearing FDI in pharma.

Since the Competition Act would not be able to address health concerns arising out of increased FDI inflows into the Brownfield projects. Sharma has also proposed a high-level meeting to be chaired by the PM to etch out differences on this contentious issue once and for all. Will the PM heed to Sharma's request? It is far from clear at present.

Source : moneycontrol.com