Day 53 – Q 1. What are the locational factors for the pharmaceutical industry? Discuss with the help of suitable examples. 

1. What are the locational factors for the pharmaceutical industry? Discuss with the help of suitable examples. 

फार्मास्युटिकल उद्योग के लिए स्थानीय कारक क्या हैं? उपयुक्त उदाहरणों की सहायता से चर्चा करें।

Demand of the question:

It expects students to mention the locational factors for the pharmaceutical industry with relevant examples for the specific location.

Introduction:

The pharmaceutical industry discovers, develops, produces, and markets pharmaceutical drugs for use as medications  to patients. Pharmaceutical industry being a major global economic force relies on production of pharmaceutical drugs in a  safe, clean and efficient environment, hence location of  pharmaceutical industries are selected accordingly. 

Body:

The pharmaceutical industry’s operating environment is complex because of economic, political, technical, and social influences within a growing global environment for product development and delivery. Though pharmaceutical industry is a footloose industry (i.e. it does not require specific local resources) following  locational factors  needs to be considered for the pharmaceutical industry:

• Availability of Raw material: An ideal location is one where the main raw material required to manufacture the product is adequately available. This will ensure regular supply of the material and will reduce the transportation costs. e.g. Indian pharmaceutical industry is located near the western coast of India. The ports on western coast help to import raw materials required for the manufacturing of drugs.
• Nearness to the potential market: Marketing of finished goods efficiently is an important function of an enterprise. If the plant is located near the market, then the management can keep close touch with their changes in market environment and formulate its production policies accordingly. Moreover, the transportation and other overhead expenses are reduced. e.g. Indian pharmaceutical industry is located near the western coast of India. Proximity to ports (Kandla, Bhavnagar etc.)  facilitates easy export to Africa, Europe etc.
• Location should be near to source of operating power: For  some specific operations in industries, cheap, continuous and adequate power supply is needed. Location of the plant near to the hydel-power situation will provide cheap electricity.
• Supply of labour: Labour is one of the most important inputs in any industrial enterprise. There should be regular and cheap supply of labour, specifically the skilled labour. Also, If there is adequate supply of local labour/unskilled labour near the plant, then naturally it will be available at cheaper rates.
• Transport and communication facilities: Transport is very important for bringing raw materials, fuel from different places, marketing of finished products etc. The region well connected with rail, road, water and air transport system is considered to be more appropriate for the location of the plants.
• Suitability of land and climate: Sub-soil of the location should be able to support the load likely to be placed on it. Similarly, climatic conditions viz humidity, temperature and other atmospheric conditions should be favourable for the plant. For  example, humid atmosphere is not suitable for the formation of pharmaceuticals.
• Local building and state policy regulations: Proposed location should not be infringe local regulations and bye-laws. Laws for the construction of buildings, local taxes etc. should be taken into consideration for the selection of site. Favourable state government policies also influence the location of industries, e.g. stable policies of Gujarat, Maharashtra.
• Safety requirements: Industries likely to cause pollution or processes explosives in nature should be located in remote areas.

Considering these locational factors, Indian pharmaceutical industry is located near the western coast where raw material is available, also it is well connected to the market through rail, water, road and air. Also highly skilled as well as unskilled workforce is available.

Conclusion:

The pharmaceutical industry has grown in the last several decades and has become quite complex, promising to deliver valuable products that enhance the quality of life to an expanding global population that demands greater access and more affordable choices. Being the pharmacy of the world, India has shown its potential to be the leading producer in the pharmaceutical industry, with more enhancement in it India can prove to be a global leader in the pharmaceutical industry.