NOTE 59 The case for nationalization of the foreign sector in drug industry is most obvious. Yet, it is surprising how the Hathi Committee has been reluctant to include this suggestion in its report. It was only after one member, Chawda, insisted that his note of dissent demanding nationalization be incorporated in the final report that it was recommended as a majority view. The committee made several other recommendations aimed at eliminating or severely restricting the harmful role of the foreign corporations. The committee recommended that foreign companies be obliged to shift their operations from the highly profitable manufacture of formulations (using imported basic drugs) to basic drugs within a period of three years. Another major recommendation is that within one year they should switch over to bulk drugs to the extent of 50 per cent and share the remaining 50 per cent with Indian companies for formulations. It also suggested that foreign companies should be issued new licenses to manufacture bulk drugs only when Indians are not coming forward to do so. Also, foreigners should be permitted neither capacity expansion in vitamins and tonics, nor output of additional items, nor beyond the licensed capacity. It has also been urged to bring down foreign-owned equity share progressively to 25 per cent. Who Is Afraid of Whom? The powerful foreign monopolies knew what to do and took a firm stand. They have been lobbying for new licences, making it clear that they have no intention of sharing production with Indian companies. Bowing to the pressure tactics, government has been dragging its feet. Petroleum and Chemicals Minister KD Malaviya on 5 May 1975 pleaded for postponing consideration of the Hathi Committee Report till the next session of parliament. In Delhi on 27 May, he said that there would be no doctrinaire approach to the question of takeover of multinational drug firms and that they would be allowed to continue in business in order to make sure that life-saving drugs do not disappear from the market! Is the government so powerless to prevent the foreign sector from indulging in anti-social practices like creating artificial shortage of life-saving drugs ? The sickness in the drug industry, diagnosed in this note, cannot be effectively treated while foreign capital holds sway. Even the Indian monopolies should be handled with more firmness. Public health is the responsibility of the government. It should not allow drug manufacturers to continue profiting from human suffering and, worst of all, let them get away with impunity. MEENA GUPTA ' L K Mutatkar, "Drug Control Order Futile", Economic Times. 1 May 1975, p 6. fl B V Rangarao, ^Indian Drug Industry", Mainstream, I March 1975, p 18. s S Ranga Rao, "Pharmaceutical Industry in India"', Economic and Political Weekly, 26 February 1972.