US should grant India special waiver from DPA

The United States ought to consider granting India a special exemption or waiver from the imposition of its Defence Production Act (DPA) on raw materials for Indian vaccine manufacturers. This would probably be the clearest and most durable way forward on an issue, which if not resolved, could adversely impact Indian plans to ramp up vaccine production.At present, there’s considerable confusion on the matter. Partly, because India too has not articulated its requirements clearly. What we know now is there is one demand for 37 vaccine-related raw materials, which is specific to maintaining current production levels, especially for Covishield. That issue is now getting addressed with the US authorities looking at control status of every single item and arranging its export to India.However, as India’s Covid-19 crisis compounded, so has its requirements. India needs to urgently scale up its vaccine production to inoculate a large population. This wasn’t the case even until six weeks ago. As a result, we now have to take into account not just Serum Institute of India’s demands but also every other vaccine manufacturer, present and prospective alike. This includes Sputnik V, Bharat Biotech, Zydus Cadilla, Bilogical E, among others. As of now, there are over a dozen vaccine candidates, of which four to five of them hope to be manufacturing in two to three months.From what we gather, government deliberations with these manufacturers have revealed that there are close 66 essential vaccine raw materials of which about 60% — from a dozen types of bags to store material at specific temperatures to biological and chemical substances, filters including nano-filters, flasks and other containers — are sourced from the US.In fact, it emerges that nearly 80% of WHO certified vaccine-related raw materials are manufactured in the US. Now, any vaccine maker must for health standard reasons maintain a WHO-reliable supply chain. Also, alternates are not easy to find, except may be in China which is both doubtful and limited as an option. White House Covid-19 supply coordinator Tim Manning is not wrong when he says the US Defence Production Act does not ban exports to other countries but only requires US companies making raw materials to “prioritise their government contracts ahead of other order”. That leaves only the tailend of the production line for other manufacturing entities outside the US, like in India.The US Government Accountability Office, which did an audit on the use of DPA between March 2020 and September 2020, found that the Act was used in prioritising 43 contracts valuing $3.9 billion over others with an objective to reduce dependence on foreign suppliers. While this worked well for ventilators and N-95 masks for which the US was becoming increasingly dependent on China, it also blocked priority vaccine raw materials. And this applied even to offshore facilities of the US companies. The problem, therefore, is politically complex. While US President Joe Biden can be liberal on case-by-case approvals, his administration may be reluctant on lifting these restrictions altogether given that vaccination is still underway in America. Also, Europe and Canada have their own list of requirements. At the same time, Washington needs to recognise that India’s manufacturing programme must take wings to counter new mutations at the earliest.In other words, it’s in American interest to have majority Indian population inoculated given the extent of contact and cooperation between both countries. Also, Indian vaccines, in the long run, will be the ones to be deployed in less developed countries. Thus, in this backdrop and given the current state of the strategic partnership, it would make better sense for Washington to actively consider an India-specific waiver from the DPA. Such a political carve out would most likely receive the necessary bipartisan support, which would only strengthen Biden’s hand at providing India support to not just make a necessary minimum but a sufficient, if not surplus, maximum number of vaccine doses, and possibly at the earliest.

from Economic Times https://ift.tt/3u2TgEq