Biopharma SHAKTI: Can India Turn A Rs 10,000-Crore Push Into Real Innovation?

In April 2025, Swarajya wrote about how India's $50 billion medtech dream was trapped in a bureaucratic nightmare: startups reported navigating "murky" regulations, paying expensive consultants to decode opaque processes, and waiting months for test licences from the Central Drugs Standard Control Organisation (CDSCO).

The regulator, sources said, was not making information accessible.

About 10 months later, in the Union Budget 2026-27, Finance Minister Nirmala Sitharaman announced Biopharma SHAKTI — a Rs 10,000 crore initiative to make India a "global biopharma manufacturing hub" for biologics and biosimilars.

Among its promises, notably, was strengthening CDSCO "to meet global standards and approval timeframes through a dedicated scientific review cadre and specialists."

The question is whether SHAKTI will deliver where previous schemes have stumbled. Or whether it is, as one founder put it, a matter of "how they want to play this."

The Case for Urgency

The rationale underlying SHAKTI is undeniable. India's disease burden has fundamentally shifted. Non-communicable diseases like cardiovascular conditions, diabetes, cancer, chronic respiratory illnesses now account for 63-65 per cent of all deaths in India, up from 38 per cent in 1990. These are conditions that demand biologic therapies: monoclonal antibodies, recombinant proteins, gene therapies.

"While India has made remarkable progress in managing and controlling many infectious diseases, the rapid rise of non-communicable diseases such as diabetes, cancer, and autoimmune disorders presents a complex and urgent challenge," says Sidhar Ranganathan, former Managing Director of Allergan India and a Steering Committee member at the Department of Biotechnology. "With increasing life expectancy, the prevalence and long-term management of these conditions are only expected to grow."

The market opportunity is equally real. Between 2025 and 2032, dozens of high-value biologics are set to lose patent protection globally, five of which are generating over $10 billion each in annual revenues. India, which approved its first biosimilar in 2000 (before the United States or Europe), now has over 135 approved biosimilars domestically, more than any other country. Companies like Biocon have built global-scale manufacturing facilities and secured approvals in regulated markets.

Ranganathan sees SHAKTI as timely. "Strategic investments in biologics and biosimilars will not only enhance affordability and access but also position India as a global leader in advanced biopharmaceutical innovation and manufacturing," he says. "I expect this to be helping translational research see more clinical applications from the laboratory."

Industry bodies have largely welcomed the announcement. Rajiv Nath, Forum Coordinator of the Association of Indian Medical Device Industry (AiMED), called it "a landmark step towards positioning India as a global biopharma manufacturing hub." Biocon Group Chairperson Kiran Mazumdar Shaw described it as "a decisive investment in India's health and innovation future."

The Numbers Question

But scratch beneath the welcome statements, and some concerns emerge.

SHAKTI promises Rs 10,000 crore over five years, which is roughly Rs 2,000 crore annually. Within this envelope, the government aims to establish three new National Institutes of Pharmaceutical Education and Research (NIPERs), upgrade seven existing ones, create a network of over 1,000 accredited clinical trial sites, and strengthen CDSCO with dedicated specialists.

The maths may not quite be realistic.

For reference, let's look at the historical spending on NIPERs. The six NIPERs established in 2007-08 — at Ahmedabad, Guwahati, Hyderabad, Kolkata, Raebareli, and Hajipur — have received more than Rs 1,200 crore (until 2022) cumulatively since their inception for infrastructure and activities. That works out to roughly Rs 200 crore per institute over 15-plus years. Yet four of these six still operate from rented premises; only the NIPERs in Guwahati and Ahmedabad have a permanent campus alongside the original NIPER Mohali.

In 2021, the Department of Pharmaceuticals sent a consolidated proposal worth Rs 4,300 crore to the Ministry of Finance for strengthening seven existing NIPERs and establishing five new ones over 2020-25. That proposal — for fewer new institutes and no clinical trial sites — was nearly half of SHAKTI's entire five-year outlay. The Expenditure Finance Committee did not support the proposal for new NIPERs at that stage.

More recently, in FY24, the Department requested Rs 1,286 crore but received only Rs 550 crore for NIPERs. A separate Rs 700 crore was approved in 2024 for Centres of Excellence across existing NIPERs over five years.

Against this backdrop, Rs 2,000 crore annually for three new NIPERs, seven upgrades, 1,000-plus clinical sites, and CDSCO strengthening appears ambitious.

"Is 2,000 crore sufficient to allow establishment cost of three new NIPERs, augmentation of existing seven NIPERs, and setting up of 1,000-plus clinical sites?" asks a senior academic in the pharmaceutical sciences space, who requested anonymity to speak candidly. "It is not clear what is meant by 'setting up of clinical trial sites.'"

The academic raises a deeper question: "In our cumulative history, we have 167 biologics and biosimilars, very few innovator drugs — so who will utilise the 1,000-plus clinical trial sites?"

This points to a structural issue. India excels at manufacturing biosimilars — near-copies of biologics whose patents have expired. What it lacks is a robust pipeline of novel drug discovery. Clinical trial sites are infrastructure for testing drugs. If the drugs being tested are primarily biosimilars requiring abbreviated pathways, 1,000 sites may be overkill. If the ambition is novel therapeutics, the ecosystem to generate those candidates barely exists.

Scale Versus Innovation

This tension — between scaling what exists and building what doesn't — runs through expert assessments of SHAKTI.

Vaibhav Sai, a synthetic biologist and founder of DiagnoBac's, a startup developing biosensor-based diagnostics, frames it directly: "If Biopharma SHAKTI primarily optimises for scale and incumbents, it will strengthen manufacturing. If it optimises for startups, it will create innovation."

His concern is that the benefits will accrue to established players — large biologics manufacturers and contract manufacturing organisations (CMOs) — rather than early-stage companies working on novel modalities.

"True spillovers happen when early-stage teams can access pilot-scale facilities, testing infrastructure, and regulatory guidance before they are forced to partner with or sell to incumbents," says Sai. "Without that, SHAKTI risks accelerating scale without accelerating innovation."

The anonymous academic is blunter about what SHAKTI omits: "What I would have loved to see is that the government invests in developing capability and pipeline for new drug discovery and drug development. The government should have bold vision."

He lists what that vision might include: large-animal testing facilities, centres for developing disease models, infrastructure for rational drug design. "We must invest in this space, else sooner or later our pharma industry will meet the fate of our IT industry," he warns.

The NIPER Precedent

The promise to expand NIPERs carries its own baggage. India currently has seven operational NIPERs at Mohali, Hyderabad, Hajipur, Kolkata, Guwahati, Ahmedabad, and Raebareli. But several announced NIPERs have languished. Plans for institutes in Nagpur, Jhalawar, and other locations were announced years ago and remain, as one industry observer put it, "on paper only."

More fundamentally, the academic questions whether NIPERs in their current form address the actual bottleneck.

"India already has a biologics and biosimilar ecosystem. I am not sure how the proposed investment would strengthen that," he says. "However, it is a fact that very few industry-ready professionals come out of Indian academia in the biology-related domain. If NIPERs can augment the supply of competent professionals, then it would be a good idea."

He offers a cautionary historical parallel: "There was a time when someone, in a previous government, thought that after IT there would be a biotechnology boom, and thus BTech Biotechnology programmes were started in every technical institution. The industry hiring did not match expectations, and today most take up that branch as a last resort. That should not become the case with NIPER graduates."

Sai echoes this from a founder's perspective, though he frames the problem differently. "Talent is not the core bottleneck. Translation is," he says.

India produces strong scientific talent at the PhD and master's level, he argues. The gap emerges when startups need people who can move from laboratory proof-of-concept to manufacturable product, design experiments with regulatory endpoints in mind, or work across biology, hardware, and data.

"New NIPERs help, but unless curricula and incentives change towards product-oriented biotech, the bottleneck simply shifts downstream," he says.

The Regulator in the Room

For founders navigating India's biotech ecosystem, CDSCO remains the critical variable. The budget's promise to strengthen the regulator "through a dedicated scientific review cadre and specialists" speaks directly to a long-documented problem.

"The promise to strengthen CDSCO with domain specialists resonates," says Sai, "if those specialists have hands-on exposure to emerging technologies and engage startups early — not just at the approval stage."

His characterisation of the current regulatory environment is revealing: "For novel therapeutics, diagnostics, and biosensors, regulation today is more ambiguous than hostile."

The challenge, he explains, is not opposition but the absence of clear pathways for novel modalities — whole-cell biosensors, synthetic receptors, gene-editing therapies. "Startups often don't know which category their product even falls into, what level of validation is 'enough' at early stages, or when to engage regulators without slowing down iteration."

What founders need, he says, is "dialogue before dossiers."

The academic suggests a concrete mechanism: training regulatory specialists as a sub-specialisation within NIPERs and engineering institutions. "CDSCO needs to be desperately augmented, and adding dedicated technical staff may be a good idea, but the government may also consider raising dedicated technical staff for the purpose."

There are signs of incremental progress. Just last week, the health ministry notified changes scrapping test licences for non-commercial drug manufacture and cutting CDSCO approval timelines from 90 to 45 days for certain categories. The 2025 Draft Biosimilar Guidelines align more closely with international norms. MedTech Mitra, an ICMR initiative that pairs startups with regulatory guidance, has drawn praise from founders who have used it.

But Sai's assessment of the broader picture is measured: "At the policy announcement level, agility is still limited because frameworks are broad, slow, and often reactive."

He offers a nuanced view: "India is not yet agile by default, but it's becoming selectively responsive — which is an important transition phase." The caveat: "Progress depends heavily on who you interact with rather than what the policy says. That's not sustainable."

What Would Make the Difference

If SHAKTI is to move beyond manufacturing scale towards genuine innovation, what would that require?

Sai proposes a specific addition: "A national regulatory sandbox plus shared pilot infrastructure programme."

Concretely, this would mean time-bound regulatory sandboxes for novel biotech, diagnostics, and pharma; subsidised access to GMP-adjacent pilot facilities; and milestone-based support instead of heavy upfront compliance.

"Early-stage biotech doesn't fail due to lack of ideas," he says. "It fails in the valley between lab success and regulatory acceptance. SHAKTI should explicitly target that gap."

On the clinical trials infrastructure, he offers a conditional assessment. The 1,000 accredited sites could be transformative if they are accessible to startups (not just large contract research organisations) and affordable with time-bound processes.

"If not," he warns, "the number '1,000' risks becoming symbolic rather than transformative."

The Execution Test

Ranganathan, despite his optimism, grounds his assessment in a crucial caveat: "With the right execution, it can foster a thriving environment for startups, encourage indigenous innovation, and reinforce India's role as a trusted global partner in advanced healthcare solutions."

The phrase "with the right execution" recurs across assessments of SHAKTI. It is the variable that separates policy announcement from policy impact.

India has announced ambitious schemes before. The Production Linked Incentive (PLI) scheme for pharmaceuticals exists but, as industry observers note, smaller companies struggle to access benefits due to complex application procedures and disbursement delays.

The PRIP scheme (Promotion of Research and Innovation in Pharma MedTech) was notified in 2023 and the application window opened in October 2025; the academic says he does not know how many actually benefited from it, and suggests the government "rework the terms and conditions" if uptake was poor.

Nath's statement welcoming SHAKTI embeds asks that signal current policy gaps: restoration of weighted R&D deduction up to 200 per cent, expansion of PLI support to biosimilars and complex generics, and follow-through on the Finance Minister's promise of "deregulation and reduction of regulatory compliance burden."

The budget has identified a real problem: India's NCD burden demands biologic therapies that remain expensive and largely imported. It has identified a real opportunity: the patent cliff creates space for Indian manufacturers with existing capabilities. It has announced components that, in principle, address documented gaps: regulatory strengthening, research infrastructure, clinical trials capacity.

Whether SHAKTI becomes a platform for innovation or merely a programme for incumbent scale depends on choices not yet made: how funds are allocated, whether startups can access infrastructure, whether CDSCO specialists engage early with novel technologies, whether NIPERs train for translation rather than just research.

As Sai puts it: "It all depends how they want to play this."