New Delhi: Flagging a sharp rise in input costs on account of the near-effective blockade of the Strait of Hormuz amid the ongoing conflict in West Asia, medical device makers in India have sought customs duty rebates to offset rising costs and maintain affordability of products.
In a letter to the Commerce and Industry Minister, Piyush Goyal, the Association of Indian Medical Device Industry (AiMeD) raised that the prolonged blockade of the Strait of Hormuz — a critical shipping route for the industry — has led to “unprecedented increases in key raw materials and energy inputs.”
The industry, which had managed initial shipment delays during the first three weeks of the conflict through buffer stocks, added that the prolonged disruptions now risk production slowdowns and exposure to opportunistic pricing by dominant raw material suppliers.
For absorbing the rising input cost, the industry looby has requested for granting a temporary three-month customs duty rebate —2.5 per cent on raw materials and 5 per cent on components.
According to AiMeD, ever since the outbreak of war in Iran, prices of critical plastics used in medical disposables have risen by 50 per cent, while packaging materials have increased by over 20 per cent.
Additionally, the expanding energy crisis, partly due to curtailed commercial gas supplies, has led to a doubling of Adani PNG gas prices, widely used for process heating and captive power, resulting in production slowdowns and operational disruptions across manufacturing facilities.
