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The Biotech Manifesto of Maharashtra

Author: Clarissa D'Lima


The strain on the healthcare system in the current pandemic and the demand for a novel cure is a much-awaited update by all. While countries around the globe seem to be in a grappling chase to find a vaccine, the mere discovery alone is unlikely to put an end to the list of woes that the virus has brought along with itself when it comes to healthcare, though most of us would like to romanticize the idea of the early vaccine discoveries playing the Messiah. While new biotech start-ups, that have taken birth during the pandemic have managed to roll out without a formal set-up, the growth of these start-ups require access to space to enable them to progress and strengthen the force working towards healthcare services and products. The need of the hour is a resounding call for a holistic support system to aid the efforts of researchers and pharmaceutical ventures which cannot do without well planned infrastructural facilities, more so, given the increased importance to carve out space and ensure ease of navigation at present. In light of this, the current article briefs out the requirement for setting up of biotechnology parks with focus on the incentives available for such projects in Maharashtra.


Bouncing Back to Biotech:


Since the early 2000s, states across India have witnessed the up-spring of biotechnology park projects. The sound development of biotechnology as an industry requires a host of mechanisms to work in tandem, including development of linkages with academic research in the field, simplified and timely regulatory approvals, financial support and developed transport network. The infrastructural need of the sector is thus largely dependent on the state’s support. Maharashtra (‘the State’), in 2003 opened its doors to the first biotechnology park which was set up as a joint venture between the Maharashtra Industrial Development Corporation (MIDC) and The Chatterjee Group.[1] If we are to contrast the reason for inviting investments for a biotechnology park back then to doing so now, we are likely to see the hyped urgency for the same at this point. The Biotechnology Policy of Maharashtra, 2001, sought to establish Maharashtra in the lead as a hub of opportunities for biotechnology ventures ranging from research to manufacturing for a host of sectors including healthcare, agriculture and bio-fuel production.[2] This policy aims to establish the State as a facilitator which eases the initial set-up of biotechnology related activities. The State seeks to make available land from agricultural zones, as well as, industrial land parcels available for the purpose. Ease of permission from the regional development authority has also been ensured for treatment of waste and effluents in balance with maintenance of the ecology. Some of the notable measures provided for in the policy to achieve these objectives are as follows:


i) Eligibility Criteria- In order to set up a unit as a biotechnology unit, it is required that the unit should have over 75% of its annual turnover from biotechnology related activities/products. A unit can apply for a Letter of Intent (‘LOI’) for its initial set-up and such LOI will be valid for a period of three years. Post this period of three years the unit may apply for revalidation by providing the details of the progress of the set-up process. Once such a unit commences its activities it will be eligible for registration. It may be noted that biotechnology units that are involved in production of items which are mentioned under Schedule- I of the Industries (Development & Regulation) Act, 1951 require to compulsorily obtain industrial license from the Government of India.[3]


ii) Additional FSI- Maharashtra has promised incentives related to double Floor Space Index (‘FSI’) grant for such projects as a part of its policy. The grant of additional FSI for units situated in the Municipal Council and Nagar Panchayat Regions of Maharashtra have been reflected in the Development Control and Promotion Regulations (DCPR) prescribed for these regions. The prescribed conditions require that a minimum of 90% of the built-up area should be used for biotechnology related activity.[4]


iii) Stamp Duty Exemption- The State’s Package Scheme of Incentives-2019 which will be in force till 2024, also provides for varying stamp duty exemptions for setting up of new biotechnology units depending on the location of the unit and subject to the unit obtaining an Eligibility Certificate under this scheme. The exemption available for units located in and arounds regions surrounding Mumbai that are classified as Group A regions are eligible for 100% waiver on stamp duty payment.[5]


iv) Simplified Environmental Clearances- The State has also taken the initiative to simplify the process of obtaining environment related clearances. In 2019, the Maharashtra Pollution Control Board (‘MPCB’) decided to provide for a minimum five year Consent to Operate Approval to Large, Medium and Small Scale units.[6] Biotechnology related activities normally fall under the Red Category of projects as per the categorization of MPCB, however, even this category of industries stand to benefit from the minimum period set for the Consent to Operate approval and are further eligible for a maximum consent period of fifteen years.[7] The State has also emphasised on providing support for life science related research and development by providing land to such centres at concessional rates.


Building New Bridges:

While the above-described policy provides an attractive pitch for setting up biotechnology units with the host of available incentives and the continued effort by the State to provide relief in the most cumbersome steps of obtaining approvals, there are other dimensions that need to be considered to tackle newfound challenges. The inclusion of these improvements is significant considering that the policy of the State has stood unchanged for more than a decade against the rapid scientific advancements.

The additional FSI promised under the policy is pertinent to the need for expansive spaces in the present pandemic conditions. In addition to incentivising FSI for a unit, the policy may be revamped in light of its existing objective to provide for supply of skilled personnel to the industry. This can be done by considering allocation of FSI for a mix of biotechnology related functioning, as well as, for providing residential support within a biotechnology cluster for easy and safe mobility of engaged personnel which in turn ensures that human expertise is not compromised with in developing effective products. Integration with technology driven ventures will also provide a strong pillar for the industry, hence, the inclusion of activities that can provide technological support to biotechnology related research can be included in the 90% built-up area reserved for biotechnology activities in a unit.


The policy in its current form also envisages the setting up of Business Facilitation Centres (“BFCs”) to facilitate better client interaction and provide handholding to entrepreneurs in availing the necessary logistical support for their units. As per the policy, these centres are to be equipped to provide secretarial and communication services to biotechnology units.[8] The utilisation of such facility in the current times, may be expanded to provide exclusive infrastructure to set up a virtual forum for communication, which will not only erase physical boundaries when it comes to sharing expertise in research and development, but can also facilitate synergy between biotechnology and telemedicine and remote healthcare service related initiatives. The infrastructure so planned should buttress research efforts of biotechnology units that are aimed at formulating products and services suited for such new initiatives. The niceties of the infrastructure model required for such facilities can further be deliberated upon and included in the State’s policy to invigorate the positive developments that can be churned out of the present healthcare crisis.


Bolstering Biotech Initiatives:


The policies surrounding biotechnology facilities in the country also give emphasis to small industries to foster research and pilot projects.[9] The biotechnology sector is also allowed to receive 100% FDI through the automatic route for greenfield projects. The recent amendment to Schedule VII of the Companies Act, 2013 also gives further impetus to funding of research and development projects in the field of science, technology and medicine by classifying these activities as eligible for CSR funding subject to the Companies (Corporate Social Responsibility Policy) Rules.[10] The potential channelising of real estate investments to specific sectors considering the effects of the pandemic on real estate projects may offer an appropriate opportunity for companies to enter the biotechnology sector.


While existing biotech parks have common constituents such as laboratories, libraries and training centers, the upcoming parks will require enhanced focus on setting up incubation centers and infrastructure that supports bioinformatics which can aid research endeavours that rely on large data for developing treatments for chronic diseases.[11] Thus, another area where biotechnology is likely to find new infrastructural support in Maharashtra is in the area of data storage. With data centers rolling up their sleeves to provide for increase in demand, biotechnology firms that require support for the management of big data in their bioinformatics undertakings can benefit from the data centers in key regions.[12] Cities that already have an existing base for such data centers can be seen as an option where technology flows with its torrents to aid novel ventures thrive.


The setting up of new biotech projects with new models of infrastructural facilities adapted for the needs of the present time is much awaited and so awaited to be welcomed by the State as a facilitator. As said by Ryan Bethencourt, the scientist entrepreneur- the potential for synthetic biology and biotechnology is vast; we all have an opportunity to create the future together.


[The author is a student of Law at the Kirit P. Mehta School of Law, NMIMS Deemed-to-be University, Mumbai.]



Notes and References

[1] IBPL, About International Biotech Park, IBPL.Net, available at https://www.ibpl.net/html/about.htm. (Last visited on October 11, 2020).

[2]Government of Maharashtra, Maharashtra Biotechnology Policy 2001 Preamble, MIDC, available at https://www.midcindia.org/documents/20181/28829/BioTechPolicy.pdf/d8465368-c1e0-4aed-875e-57393b902f38.(Last visited on November 02, 2020). [3] Directorate of Industries, Maharashtra Biotechnology Policy 2001 - Letter of Intent / Registration of Bio Technology (BT) Units for availing of various State incentives,H. O. Circular No. - 21/2002 (Issued on August 23, 2002).

[4] Urban Development Department, Standardised Development Control and Promotion Regulations For Municipal Councils And Nagar Panchayats In Maharashtra 88 (2013).

[5]Government pf Maharashtra, Industries, Energy and Labour Department, Package Scheme of Incentives – 2019, Resolution No. PSI -2019 / CR 46 / IND-8 (Issued on September 16, 2019).

[6] MPCB, Grant of Consent to Operate for a Minimum of Five Years for Large/Medium/Small Scale Industries, Circular No. MPCB/AST/EoDB/B-1094 (Issued on March 19, 2019).

[7]MPCB, Implementation of the Enforcement Policy, Circular No. MPCB/AS(T)/TB/B-894 (Issued on March 01, 2016).

[8] Maharashtra Biotechnology Policy 2001, supra note 2.

[9]Ministry of Science and Technology, Draft National Biotechnology Development Strategy. Available at https://www.prsindia.org/sites/default/files/bill_files/bill26_2007010326_National_Biotechnology_Development_Strategy.pdf.

[10]Ministry of Corporate Affairs, Notification, G.S.R. 525(E) (Issued on August 24, 2020). Available at http://www.mca.gov.in/Ministry/pdf/NotificationCompAct_26082020.pdf.

[11] Biotechnology Resource Center, Database of Biotechnology Related Entities in India, Venture Center, available at http://venturecenter.co.in/brc/bio_parks.php (Last visited on October 10, 2020).

[12]A.Padmanabhan, R.Reddy, & S. Sharma, Modern Biotechnology and India’s Governance Imperatives (Carnegie Endowment for International Peace, 2017). Retrieved from http://www.jstor.org/stable/resrep12920, (Last Visited September 4, 2020).

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