India Seeks Reciprocity from EU on Medical Devices in FTA

New Delhi, Mar 16 (PTI) India should seek reciprocal concessions from the European Union (EU) under the proposed free trade agreement (FTA) in the medical devices sector to promote its exports, economic think tank GTRI said on Sunday.

India charges zero to 10 per cent tariffs on most medical devices and a duty cut by India on medical devices without addressing EUs regulatory challenges will result in low exports but large scale imports from EU.

"To achieve a fair trade deal, India must demand reciprocity. India should cut tariff on medical devices only if the EU reduces its non-tariff barriers," the Global Trade Research Initiative (GTRI) said.

The ongoing India-EU FTA negotiations on medical devices are asymmetrical.

While the EU demands zero tariffs on medical devices from India, it maintains high regulatory barriers that hinder Indian exports difficult in the EU markets, it added.

GTRI Founder Ajay Srivastava said the EU customs duty rates are zero, but market entry costs are substantial because of the stringent regulatory framework.

"Exporting to EU has become more difficult as it replaced the Medical Device Directives (EU-MDD) with the more stringent Medical Device Rules (EU-MDR)," he said.

Citing an example, he said the new certification and regulatory expenses amount to 60,000-300,000 euro annually for market access of 100,000-3.75 million euro.

"Certification approval time increased from the earlier 4-8 months to 2-3 years now. Shortage of notified bodies and auditors in the EU is leading to high certification costs," Srivastava said.

On account of this, Indian exporters are withdrawing from the EU market or limiting product offerings as high entry and certification costs make market participation financially unsustainable, he noted.

Moreover, he said the lack of Indian participation in the Medical Device Single Audit Program (MDSAP) limits the acceptance of Indian devices in key regulated markets.

MDSAP allows medical device manufacturers to be audited only once for compliance with regulatory requirements in multiple markets, including Australia, Brazil, Canada, Japan, and the United States.

To facilitate exports in EU and other major markets, India needs to undertake the reforms like seeking MRAs (mutual recognition agreements) with the EU, USA, and other regulated markets based on ISO (International Organization for Standardization) harmonised standards.

Indian medical devices sector is steadily growing and helping India cut its reliance on imports.

In 2024, India's global exports were USD 2.3 billion while imports were USD 4.7 billion.

EU remains an important market with exports of USD 580 million and imports of USD 1.15 billion.