Haryana Pharmaceutical and Medical Devices Manufacturing Policy 2026: Up to INR 200 Crore CAPEX Support and a 10-Year OPEX Package

India is the world's third-largest producer of pharmaceuticals by volume but ranks only eleventh by value. It still depends on imports for around 72% of bulk drugs and intermediates and roughly 80% of its medical device demand. The Haryana Pharmaceutical and Medical Devices Manufacturing Policy 2026 is the State's answer to that gap. It is a five-year policy that targets at least INR 10,000 crore of investment and 20,000 direct and indirect jobs, while pushing manufacturers up the value chain into APIs, biologics, biosimilars and high-end medical devices.

It is one of the most generous sectoral packages Haryana has offered so far. Below we summarise who qualifies, what is on offer and the practical points manufacturers should plan for.

Who is eligible?

•         Covered activities: manufacture of pharmaceutical products (APIs/bulk drugs, Key Starting Materials, drug intermediates and formulations), biologics, biosimilars and medical devices, as defined by the Government of India. An indicative annexure covers implants, disposables, diagnostics, IVD devices, electro-medical equipment, imaging, surgical and endoscopic devices, OT equipment, assistive devices and components.

•         Licences: units must hold and maintain all approvals under the Drugs and Cosmetics Act, 1940, the 1945 Rules and the Medical Devices Rules, 2017.

•         New units must commence commercial production (date of first sale invoice) after notification and within the policy period, and must apply before commencing commercial operations.

•         Expansion/diversification by existing units qualifies once in the policy period where the additional FCI is at least 50% of existing FCI, or at least 25% subject to a minimum of INR 125 crore, or exceeds the Mega/Ultra Mega threshold. Land must have valid CLU (where applicable) or be in an approved industrial estate/IMT, and a separate GST registration and books are generally required.

Investment made up to one year before notification counts where production begins within the policy period. FCI and eligible CAPEX are recognised until one year after commercial production for MSME/Large units and three years for Mega/Ultra Mega units.

Core fiscal incentives

CAPEX support (up to INR 200 crore per unit)

Support depends on the area category under the Make in Haryana Industrial Policy, with the highest rates for less industrialised regions:

Area category	CAPEX reimbursement
Prime/Focus	30%
Sub-Prime	30%
Intermediate	25%
Core	20%

The support is paid in ten annual instalments. Eligible CAPEX includes buildings and utilities, plant and machinery (including tools, dies, moulds, jigs and fixtures), IT hardware and software, new captive renewable plants (100 kW+), ETP, waste management and air pollution control systems, technology acquisition (up to INR 1 crore per year), stamp duty and External Development Charges.

OPEX support (ten years, up to INR 20 crore per annum)

Area category	OPEX reimbursement
Prime/Focus	80%
Sub-Prime	70%
Intermediate	60%
Core	50%

The list of eligible OPEX is notably broad and tailored to the sector:

•         Net SGST and electricity duty paid to Haryana;

•         Lease rentals (75% of actual rent, capped at 6% of the property's registered-valuer valuation);

•         Quality certification costs, including GMP, WHO-GMP, CDSCO, BIS, USFDA, DMF, EMA, CE, ISO and ZED;

•         Clinical trial expenses and BA/BE studies (up to five a year);

•         Patent costs, including filing, prior-art search, maintenance and publication fees;

•         CGTMSE guarantee fees and credit rating expenses;

•         Export freight and insurance, at the lower of 1% of FOB value or actual cost, capped at INR 1 crore a year.

Mega and Ultra Mega projects can also seek customised packages from the Haryana Enterprise Promotion Board (HEPB).

Export incentives (choose one option)

•         Option 1, the Export Booster: an add-on to CAPEX support equal to 5% × (export share % − 10%), based on export-linked cost of goods sold in the first three years. It is available only to units with at least a 10% export share and an average annual turnover of INR 100 crore.

•         Option 2, the Annual Export Turnover Incentive: 3% of annual export value for five years, capped overall at 4.5% of eligible capital expenditure.

Both options require a statutory auditor's certificate, and the choice is final once exercised, so it is worth modelling both before deciding.

Innovation, R&D and greening

•         Patent commercialisation: INR 50 lakh per domestic patent (cap INR 5 crore) and INR 1 crore per international patent (cap INR 10 crore), for patents granted and commercially used during the policy period, backed by auditor certification of revenue or efficiency gains.

•         R&D centres (DSIR/CSIR-recognised, limited to five centres under the policy): a 50% capital subsidy capped at INR 50 crore (Ultra Mega), INR 25 crore (Mega) or INR 10 crore (others), paid over five years, plus 50% of operating costs (scientists' salaries, consumables, conferences, publications) up to INR 2 crore a year for five years. Applications may be filed within three years of the R&D centre starting operations, to allow time for recognition.

•         Greening incentives: INR 100 per carbon credit (cap INR 1 crore); INR 50 lakh per MW for captive renewable energy of 100 kW or more (cap INR 2.5 crore for MSME/Large and INR 10 crore for Mega/Ultra Mega); 50% cost support for discharge-control measures such as Zero Liquid Discharge systems, certified against HSPCB discharge limits (cap INR 5 crore or INR 10 crore); and 2% of building cost for GRIHA/LEED-type green certification (cap INR 5 crore). Capital spent on these items is excluded from the general CAPEX computation.

Human resource incentives

•         Employment Generation Subsidy for ten years, linked to the share of Haryana-domicile employees (verified through the Parivar Pehchan Patra). At 15% or more local employment, the subsidy is 100% + 20% × (local share − 15%) of average monthly gross salary, capped at INR 1 lakh per employee per year. The base is 120% and the cap INR 1.2 lakh for women, SC, Divyang, Agniveer and ex-servicemen employees, with a minimum of INR 48,000 per employee.

•         HKRN booster: 100% reimbursement of employer and employee EPF contributions for five years for staff recruited through the Haryana Kaushal Rozgar Nigam (each capped at INR 25,000 per employee per year).

•         Internships/apprenticeships: 50% of stipend, up to INR 15,000 per month for six months, for up to 50 interns a year.

Special incentives

•         Relocation grant: 50% of the cost of moving plant and machinery to Haryana (freight, handling, insurance and customs duties), capped at INR 5 crore for domestic relocation and INR 10 crore for relocation from abroad. This is aimed squarely at "China+1" and inter-state shifts.

•         PLI top-up alternative: units availing Government of India PLI or similar schemes may instead take a 50% top-up on the central benefits disbursed. This is an either/or choice against the entire State package (sections 10.1 to 10.6).

•         Startups: 75% reimbursement of prototyping costs (up to INR 15 lakh a year, two sanctions per year), together with MedTech Pitch-a-thons and bootcamps.

Support for park developers

Private pharma, bulk drug and medical device parks (10–25 acres or more, depending on zone, with TCP licence and CTE obtained during the policy period) can choose between:

•         capital subsidy of 75% (Sub-Prime) or 85% (Prime/Focus) of trunk infrastructure cost, released in four milestone-based tranches; or

•         Net SGST reimbursement of 60% or 70% for seven years.

Either option is capped at INR 45 crore per park. Developers also receive 100% stamp duty reimbursement, whenever the land was purchased.

Regulatory facilitation

The policy also commits to several practical reforms:

•         Faster incentive payments: 50% released within 7 working days of a claim after preliminary scrutiny and the balance within 45 working days, with 8% interest on delays attributable to the Department.

•         Drug approvals: formulations already approved by neighbouring States' licensing authorities, or categorised as "rational" by Government of India expert committees, will be approved within 7 working days (unless banned under Section 26A).

•         Operations and compliance: three-shift working and night shifts for women, essential service status, labour self-certification, reduced CTE/CTO timelines, online tender participation certificates within 7 days, and dedicated relationship managers for large investors.

Key cautions

1.       Pre-commencement application is mandatory.

2.       No overlap is allowed with other Haryana policies for the same project, apart from the Haryana Progressive MSME and Exports Policy for heads not covered here.

3.       Central and State support combined cannot exceed 100% of FCI.

4.       Several choices are irrevocable: export Option 1 or Option 2, and the State package or the PLI top-up. These decisions should be modelled before the application is filed.