Context:

• India will start manufacturing the common antibiotic Penicillin G later this year, three decades after the country’s last plant shut down.

What is Penicillin G?

• Penicillin G is the active pharmaceutical ingredient (API) used in manufacturing several common antibiotics.
  • An API is the main ingredient of the drug responsible for bringing about its desired effects.

Why did penicillin manufacturing stop in India?

• The cessation of Penicillin G production in India was primarily due to cheaper Chinese alternatives flooding the market. 
• Indian manufacturers found it economically unviable to compete with the low prices of Chinese products. 
• Additionally, factors such as relaxed customs rules, economic liberalisation, and the Drug Prices Control Order contributed to the decline in domestic API manufacturing.

Why is the production being started now?

• Pandemic induced supply chain constraints: The need for self-reliance in critical pharmaceuticals became apparent during the pandemic, prompting the government to promote domestic manufacturing of APIs.
• Production Linked Incentive Scheme(PLI): The PLI scheme has shown promising results in reducing API imports and incentivizing domestic production. 

The restart of Penicillin G manufacturing in India signifies a strategic shift towards enhancing domestic pharmaceutical capabilities and reducing reliance on external sources, particularly in critical healthcare sectors.