On 11 February 2020, the Government of India issued a notification declaring that all medical devices are to be classified as drugs from 1 April 2020 under the Drugs and Cosmetics Act, 1940. The Government additionally notified rules regarding the registration of medical devices through Medical Devices (Amendment) Rules, 2020. This regulation is particularly noteworthy as it can catalyze India's growth in the healthcare sector at a domestic and global level.

Impact of Regulations

The regulation of all medical devices to be sold in India is a progressive step for foreign companies planning to enter the Indian market as well as for most existing players. The impact of this notification will be visible in three broad areas which are as follows:

  • Regulatory Clarity
    The ambiguity as to whether regulatory approvals are needed has been eliminated- all devices need to be registered and approved. In the past, a lot of potential investments faced delay or failed to materialize due to the ambiguous nature of the regulations.
  • Quality Care and Patient Safety
    The regulation will ensure a certain level of quality and standardization in the products across categories improving patient care and safety. It will also enhance the vigilance towards any adverse events and help in improving health outcomes.
  • Attracting Investments
    This decisive step in the regulatory framework and overall policy direction of the Government, coupled with growing demand, will attract investments from foreign and local players in the country. The integration of global standards is an appealing trait that will engage the transnational firms in the industry and will encourage Foreign Direct Investment (FDI). This regulation will level the playing field and favor manufacturers who invest in research and development, quality manufacturing infrastructure and quality assurance systems. Further, learnings from various industries demonstrate that improvement in quality regulations, results in better standards of products/processes, thereby enhancing the brand value and a sharpened ability to tap the global market.
  • Creating a Robust Ecosystem
    Strengthening the regulatory framework will also help create an ecosystem of supporting device manufacturers, such as the development of the required ancillary industry. This move will lay the foundation for building a vibrant and sustainable industry while creating opportunities for manufacturers to expand and services required to expand and manufacture high-end products in India.


The new rules state that all the medical devices need to be registered, and the applications for the same will have to be made on the e-portal established by the Central Drugs Standards Control Organization (CDSCO). The registration is voluntary till 18 months from the date of the implementation, post which it will become mandatory. The import license exemptions allowed under the earlier rules will also be phased out in 30 months for Class A and B devices, and in 42 months for class C and D devices, from the date of application of the amended rules.



Learnings from China

A study of our neighbor China shows how initiatives like these regulatory changes have helped transform their medical device industry and rapidly accelerate growth within a decade. China's medical devices exports during 2001–11 were low technology products such as disposable hospital supplies, bandages, first-aid kits, and surgical gloves. These represented 40 to 60% of their total exports from this sector. However, China's medical device production has steadily expanded into higher-technology, value-added segments of the global marketplace. At present, the bulk of China's exports are medium to high-tech medical devices and the share of lower-end medical products has gone down. China's government policies have been directed towards encouraging innovation and investment in high technology production capacity of local medical device firms1. During each of the three five-year plans, China unveiled during 2001– 16 has prioritized expanding domestic production of various high-tech goods, including those produced by the medical device industry2. In each of these plans, the regulatory framework was systematically improved to align with global practices and standards, encouraging domestic production while taking it one step ahead in the technology value chain.

As a result, post-2012, the composition of China's medical device exports shifted predominantly towards medium to high-tech devices. Therapeutic devices and diagnostic equipment were the vital drivers of this transition. Therapeutic devices have been China's largest medical device export category since 2012, while diagnostic equipment has registered the highest growth rate of any category since 2001.


Figure 2: Medium-to-high-value-added goods now make up the majority of China's total medical devices exports

Source: "China's Changing Medical Device Exports", Journal of International Commerce and Economics, January 2018

Note: Devices that have been categorized as low-tech include disposables, surgical instruments, intravenous diagnostic technologies, and parts of various products; medium-to-high-tech devices refer to therapeutic and diagnostic equipment. Devices which could not be clearly identified as low or high-tech were categorized as "other." These goods, which largely consisted of wheelchairs, were not included in the figure above, but accounted for less than 6 percent in each of the years covered.

A similar trend was also observed in the Indian pharmaceutical industry wherein the regulations on quality were made stringent and more FDA approved plants were set-up. Post the quality enhancements, the Indian pharmaceutical industry was one of the major exporters globally.

The notification issued by the Indian Government will give an impetus to the domestic industry to significantly contribute to exports with the improved quality of medical devices. This will also enable in gradually building an ecosystem of ancillary products and services required to manufacture high-end products.


While the plans to regulate the sale of all medical devices in the country have been in discussion with all the stakeholders for quite some time, there is still some uncertainty regarding the notification of devices being classified as drugs. Earlier reports had indicated that one of the major stakeholders, the National Institution for Transforming India (NITI) Aayog, supported the creation of a separate regulatory framework for medical devices, distinct from drugs. Nevertheless, a majority of the industry has welcomed the move.

From a long term perspective, a clear separation of governance and regulatory frameworks for drugs and medical devices would be the ideal approach. There are fundamental differences between a drug and a device in terms of the innovation cycle and process, intrinsic product characteristics, technology involved, their use, effects, and potential risks/complications in humans. These factors are best dealt with separately with different perspectives and regulations. It is likely that the long-term road map of the Indian Government for medical device regulation will have this as a destination and industry will certainly be keen to continue to work with the stakeholders to achieve this.

In 2017, the Government took the first significant step by introducing the medical device rules under the Drugs and Cosmetics Act, which clearly separated medical devices from drugs. The 2020 Medical Device Rules will accelerate the industry in this direction.

There is a possibility that the new rules will require incremental efforts in the shorter run among some existing device manufacturers in India, as it will compel them to upgrade their manufacturing and quality systems to meet the stipulated standards. However, in the long term, companies who rise to this challenge will be better placed to tap global opportunities in addition to the attractive growth in India. The new medical device regulations are a significant step towards improving patient safety and efficacy as well as to position Indian manufacturers to participate more actively in the global MedTech supply chain.

The complete notification can be read here:


[1] EIU, Medtech in China, 2017; Agarwal et al., MedTech in Asia, December 2015, 22.

[2] China's three most recent five-year plans—its 10th (2001–05), 11th (2006–10), and 12th (2011–15)—were unveiled during the period covered by this article., "The 10th Five-Year Plan,"

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.