New Delhi, September 2, 2025 – The Association of Diagnostics Manufacturers of India (ADMI) has called upon the Ministry of Commerce & Industry to urgently rationalize the inverted duty structure (IDS) affecting diagnostics kits, reagents, and in-vitro diagnostic (IVD) equipment. ADMI emphasized that the current duty regime is discouraging local manufacturing and undermining India’s ambition to become a global hub for diagnostics under the ‘Make in India’ initiative.

The Problem of Inverted Duties
Unlike global best practices, where raw materials attract lower import duties than finished products, India’s diagnostics sector faces the reverse. Essential raw materials and spare parts draw duties ranging from 7.5% to 15%, while finished kits and instruments are often taxed at only 0–5%. This anomaly makes imported products cheaper than domestically manufactured ones, limiting value addition within the country.

Illustrative Impact

ELISA kits (HIV/Hepatitis testing): Raw enzymes & proteins attract ~10–15% duty, while finished kits face ~5%.

RT-PCR machines: Spare parts taxed at ~7.5–10%, but finished machines taxed at ~5% (or 0% under FTAs).

Dengue rapid test kits: Raw materials ~10–12%, finished kits ~5%.

Such distortions, ADMI noted, make indigenous production costlier, discourage investment, and perpetuate import dependence.

Why it Matters for India

Discourages Make in India: Imports remain cheaper than local manufacturing.

Job & Skill Loss: R&D, employment, and factories shift abroad.

Healthcare Security Risks: Dependence on imports leaves India vulnerable during crises such as pandemics.

Recommendations from ADMI
ADMI has urged the government to take corrective measures, including:

Lowering duties on raw materials, parts, and consumables to 2.5%.

Gradually increasing duties on finished IVD equipment – 5% (Year 1), 10% (Year 2), 15% (Year 3).

Introducing a time-bound refund mechanism to ensure GST/duty refunds for inputs within 60 days.

Adopting proven models from sectors like mobiles, textiles, and medical devices where duty correction spurred local manufacturing, jobs, and exports.

ADMI’s Call to Action
“Diagnostics kits and instruments are not just businesses—they are the backbone of healthcare and national security,” said Jatin Mahajan, President, ADMI. “By correcting the inverted duty structure, India can not only meet the needs of its 1.4 billion citizens but also emerge as a trusted exporter in the global diagnostics market.”

ADMI reaffirmed its commitment to partner with the government to align policy with India’s healthcare and economic priorities.