India is on the cusp of a transformative era in its pharmaceutical sector which is projected to reach $130 billion by 2030, a report showed on Thursday.

The world's third-largest drug producer by volume, India is currently exporting pharmaceutical products to over 200 countries, establishing its influence in the global pharmaceutical arena, according to a Deloitte's whitepaper launched at the Assocham’s annual pharma summit here.

The paper highlighted India's potential to transform from a leading generic drug producer to a powerhouse of pharmaceutical innovation, driven by advancements in research, regulatory reforms, and strategic global partnerships.

“With the market projected to reach $130 billion by 2030, growth depends on significant investments in R&D and addressing talent shortages in areas like AI and biotechnology,” said Joydeep Ghosh, Partner and Industry Leader for Life Sciences and Healthcare at Deloitte India.

Government initiatives such as the production-linked incentive scheme aim to enhance domestic manufacturing and reduce reliance on imports.

“By fostering collaboration among academia, industry, and government, India can not only meet its healthcare needs but also position itself as a leader in global pharmaceutical innovation, driving economic growth and improving health outcomes,” Ghosh added.

As per the paper, with a growing talent pool, rising investments in biotechnology, and an increasing number of clinical trials, India is becoming a credible destination for cutting-edge drug discovery and development.

Government initiatives, collaborations between academia and industry, and advancements in digital technologies further bolster India's potential to lead in pharmaceutical innovation.

However, the paper identified critical challenges that must be addressed to fully realise India's potential as a global pharmaceutical innovation hub.

“Key issues include the need for increased investment in R&D, stronger intellectual property protections, and the closing of the talent gap in high-demand areas such as artificial intelligence and data science,” the paper noted.

To foster a robust innovation ecosystem, it is crucial to develop a cohesive strategy that integrates research, technology investments, commercialization, skilling, and intellectual property, commented Neha Aggarwal, Partner, Deloitte India.