India imports about 65% of the raw materials needed to make medicines from China, NITI Aayog said Tuesday, warning that heavy dependence on a single country or region leaves the pharmaceutical supply chain vulnerable.

Speaking while releasing the Trade Watch quarterly report, NITI Aayog Vice‑Chairperson Ashok Kumar Lahiri said the “Middle East crisis” has underlined the need to diversify suppliers for critical inputs such as medicines, oil and gas. “We should not depend on one country or region,” he told reporters, adding that India must ensure multiple sources for energy and other essential supplies so crises do not disrupt domestic availability.

The report — which also presents data on India’s overall imports‑exports and energy sector — found that while India is a global leader in producing affordable generic drugs, much of the active pharmaceutical ingredients (APIs) and other chemical inputs still come from China. Officials said the finding supports recent policy discussions on securing supply chains and boosting domestic capability.

Lahiri urged negotiators to include a dedicated pharmaceuticals chapter in any free trade agreement (FTA). “When negotiating FTAs with countries or blocs, a separate chapter on pharmaceutical products should be included,” he said, according to excerpts shared by the Aayog. The recommendation reflects concerns that tariff and non‑tariff provisions must specifically protect and promote India’s pharma value chain.

The report also highlighted rising costs for R&D and manufacturing in India. Stricter environmental rules, Lahiri noted, have pushed up the cost of running production facilities and carrying out research into new drugs. “Environmental regulations have become quite tight. That has increased the cost for companies to produce medicines and pursue new R&D,” he said. The Aayog suggested that India’s system for translating academic research into commercial products needs strengthening to attract long‑term investors.

India’s strength remains production. The Aayog’s study concluded that India performs well on drug manufacturing but needs to move up the value chain — into higher‑margin, branded and innovative products — to capture greater global value. “Indian firms have good international credibility. If they bring high‑quality, reasonably priced branded products, our grip on global markets can strengthen,” Lahiri said.

The report also underlined India’s role as a supplier of affordable generics worldwide: about half of the low‑cost medicines exported from India go to African countries. In 2025, global demand for medicines and inputs was estimated at roughly ₹123.13 lakh crore (about $1.3 trillion), of which about ₹96.61 lakh crore went to finished medicines and roughly ₹24.72 lakh crore to chemicals and raw materials used by drug makers, the Aayog noted.

To reduce dependence on imports and build resilience, the Aayog offered a set of policy suggestions:

• Encourage Indian firms to move beyond generics into high‑value pharmaceutical segments.

• Strengthen links from college and university research to industry so discoveries commercialise faster.

• Make regulatory approvals for life‑sciences innovation clearer, faster and more transparent to draw patient long‑term investment.

• Include pharma‑specific provisions in FTAs and pursue bilateral deals — Lahiri said India and the US are close to finalising a bilateral trade pact and expected to sign it soon.

Experts and industry sources say the challenge is not only policy but capacity and investment. Building API manufacturing at scale requires capital, land, and trained personnel; cleaning up chemical manufacturing to meet environmental norms adds to costs. The Aayog’s recommendations aim to balance ecological compliance with incentives for domestic production.

Further details on timelines, funding packages or specific incentives were not available in the report. Authorities are reviewing follow‑up measures, and officials said more clarity on implementation will be provided as the government consults industry stakeholders.

Why it matters
India’s dependence on China for pharma inputs is a strategic vulnerability for public health and industrial policy. Any disruption — from geopolitical tensions to supply shocks — can affect drug availability and prices at home and for countries that rely on Indian exports. Moving up the value chain would also help India capture higher margins and reduce exposure to external suppliers.

Further details are awaited as policymakers and industry leaders discuss the Aayog’s recommendations and the implications for upcoming trade talks.

Bastar is poised for a major economic transformation as Chhattisgarh Chief Minister Vishnu Deo Sai presented an ambitious development roadmap during the 11th Governing Council meeting of NITI Aayog. Addressing the gathering chaired by Prime Minister Narendra Modi, the Chief Minister highlighted efforts to turn Bastar into a model region for prosperity, employment, education, tourism, and modern industry.

Presenting his vision at the meeting attended by Union ministers, chief ministers, lieutenant governors, and senior policymakers, Sai said the state government is working to transform Bastar from a region once affected by Left-wing extremism into a hub of inclusive growth and investment.

The strategy focuses on increasing rural incomes, strengthening infrastructure, improving social services, and creating new economic opportunities for tribal communities across the region.

Focus on Income Growth

A key objective of the government's plan is to double the income of tribal households within the next three years. According to the Chief Minister, the target is to raise average monthly family incomes from below ₹15,000 to approximately ₹30,000.

The strategy combines agriculture, animal husbandry, forest-based livelihoods, small-scale industries, and welfare programmes. A major component is the promotion of a "White Revolution" through dairy development.

Under the initiative, tribal families are being provided with milch cows and buffaloes to establish sustainable sources of income. The programme is also expected to generate employment in milk collection, transportation, processing, and local marketing, particularly benefiting women and young people.

Irrigation and Agriculture Expansion

The state government is implementing two major irrigation projects worth more than ₹2,000 crore to improve water availability in the Indravati river region.

These projects aim to provide year-round irrigation across approximately 32,000 hectares, enabling farmers to diversify beyond traditional paddy cultivation. Officials expect increased production of vegetables, fruits, and cash crops, improving agricultural productivity and farm incomes.

The government believes improved irrigation infrastructure will play a significant role in strengthening Bastar's rural economy.

Tourism as a Growth Engine

Tourism has been identified as one of the primary drivers of future employment in Bastar. The government plans to develop Chitrakot and Sirpur into world-class tourism destinations.

Projects include the expansion of water sports, adventure tourism, jungle safaris, and eco-tourism facilities. In Sirpur, authorities are planning a global meditation centre, museum, and riverfront development to attract domestic and international visitors.

Officials estimate that growth in tourism will generate employment opportunities across hospitality, transportation, guiding services, handicrafts, retail businesses, and local entrepreneurship.

Healthcare and Service Delivery

To strengthen healthcare services, the state is creating approximately 3.6 million digital health profiles. These records are intended to improve patient care, facilitate information sharing among medical professionals, and enhance healthcare access in rural areas.

The government is also converting around 200 security camps in Bastar into integrated service centres known as "Seva Dera." These facilities will provide villagers with access to 371 central and state government schemes, including ration distribution, pensions, healthcare, education, and banking services.

Education and Technology Push

The development strategy includes major investments in education and digital infrastructure. The government has announced ₹100 crore for Education Cities in Abujhmad and Jagargunda.

The state has also expanded educational infrastructure through 341 PM SHRI schools and 5,857 smart classrooms. Bilingual textbooks in 16 local languages are being introduced to improve learning outcomes among tribal students.

Meanwhile, Chhattisgarh is positioning itself as an emerging destination for technology-driven industries. The Chief Minister highlighted ongoing investments in artificial intelligence, semiconductor manufacturing, electronics, and digital innovation.

Investment and Export Growth

According to Sai, Chhattisgarh has implemented 435 governance and business reforms while strengthening its single-window clearance system to attract investors.

Two semiconductor manufacturing units are currently under construction in the state. New investments in sectors such as sports equipment, electronics, bio-ethanol, garments, and textiles are also generating employment opportunities.

The state's One District-One Product (ODOP) initiative has helped local products access wider markets. Exports under the programme reached ₹761.76 crore by February 2026 during the current financial year, with aromatic rice emerging as a major contributor.

Experts Split Over Water Footprint of India's Ethanol Push

Debate intensifies as study claims massive water use for biofuel production amid deepening scarcity concerns

A fresh study highlighting the heavy water requirement for ethanol production has triggered a sharp debate on whether India's ambitious ethanol blending programme is sustainable in a country already grappling with severe water stress. While the government celebrates achieving the E20 blending target ahead of schedule, questions are mounting over the long-term impact on groundwater and drinking water supplies.

The controversy erupted after reports, drawing on government-linked data, suggested that producing one litre of ethanol from rice could consume around 10,790 litres of water when accounting for the full cultivation cycle. This figure has raised alarms among environmental experts and water conservationists, especially as many ethanol plants are located in already water-stressed regions.

Water Use Claims Under Scanner

Industry bodies have pushed back strongly against the narrative. The Grain Ethanol Manufacturers Association (GEMA) described the 10,000-litre figure as a misinterpretation that includes rainfall and crop evapotranspiration rather than direct industrial consumption. 

"Calling ethanol a water guzzler is simply incorrect," said C.K. Jain, President of GEMA. "Modern ethanol plants in India consume only about 3-5 litres of process water per litre of ethanol." He emphasised that plants are becoming more efficient with recycling and zero-liquid discharge systems.

However, critics argue that even if factory usage is low, the broader water footprint of feedstock crops cannot be ignored. According to data shared by Food Secretary Sanjeev Chopra earlier, rice-based ethanol stands at roughly 10,790 litres per litre, compared to about 3,630 litres for sugarcane and 4,670 litres for maize.

India's Water Crisis: A Stark Reality

India's per capita water availability has already fallen to 1,486 cubic metres in 2021, placing it in the water-stressed category. Projections indicate it could drop to around 1,140 cubic metres by 2050. NITI Aayog has warned that 21 major cities, including Delhi, Bengaluru, and Chennai, risk groundwater depletion.

Agriculture consumes nearly 80% of the country's freshwater, with rice and sugarcane being particularly thirsty crops. In this context, diverting surplus rice or expanding grain-based production for fuel has sparked concerns about competing demands between food, fuel, and drinking water.

Ethanol Programme: Milestones and Momentum

Despite the debate, the ethanol blending programme remains a flagship initiative. India achieved the 20% ethanol blending (E20) target in mid-2025, well ahead of the original 2030 deadline. Total production capacity has crossed 1,900 crore litres, with plants concentrated in Uttar Pradesh, Maharashtra, Karnataka, and Bihar.

The programme uses a mix of sugarcane molasses, juice, broken rice from FCI stocks, and increasingly maize. Officials highlight multiple benefits: reduced oil import bills, lower carbon emissions, and higher farmer incomes. Uttar Pradesh leads production with around 250 crore litres annually.

Shift Towards Maize

In response to sustainability concerns, the government is promoting maize as a less water-intensive alternative. Maize is often rain-fed in many regions and requires comparatively lower irrigation than rice. Industry sources indicate a gradual diversification away from excessive reliance on rice.

Ground Concerns and Expert Views

Farmers and local officials in states like Punjab and Haryana, where groundwater levels have plummeted due to paddy cultivation, express mixed feelings. While ethanol demand provides a market for surplus or damaged grains, long-term water sustainability worries persist.

Water experts point out that virtual water embedded in crops matters in a country facing erratic monsoons and climate change impacts. Some suggest stricter water audits for new distilleries and incentives for drought-resistant feedstocks.

Others counter that ethanol production utilises existing agricultural surpluses and that stopping the programme would not magically restore groundwater—better irrigation practices, crop diversification, and wastewater recycling are needed regardless.

Balancing Energy Security and Water Security

As India eyes higher blends in the coming years, the challenge lies in aligning energy goals with water conservation. The Ministry of Petroleum and Natural Gas, along with NITI Aayog, is understood to be monitoring feedstock patterns closely.

Officials maintain that the programme is designed to use surplus grains without compromising food security, while technological upgrades in distilleries minimise industrial water use.

The coming months are likely to see more detailed policy guidelines on sustainable feedstock selection and mandatory water efficiency norms for ethanol units. For now, the debate underscores a larger truth: in a water-stressed nation, every step towards green energy must be weighed against its hidden costs.