The Centre will release Rs 3,000 crore as advance payment to Covid-19 vaccine maker Serum Institute of India (SII) and yet another Rs 1,500 crore to Bharat Biotech towards vaccine supplies till July by amending procurement norms, a finance ministry official stated. A proposal in this regard was floated by the wellness ministry.
Amid a spurt in Covid infections, the advance payment – as opposed to grants asked for – is aimed at enabling the firms to scale up production of the vaccines, ahead of the third phase of vaccination from May 1, exactly where every person above 18 years can get the jab.
The money advance in the type of a supplier’s credit. The relevant procurement norms have been relaxed below the General Financial Rules as the extant norms do not permit such credit lines with no bank assure.
“I think the finance minister has approved it. It is in the form of a credit line and will be backed with adequate supplies of vaccines to support the government procurement and the vaccination programme,” Union minister Piyush Goyal stated on Tuesday.
The wellness ministry will release the payments to SII and Bharat Biotech by means of its procurement agency. Currently, the government procures the vaccines – Covishield (SII) and Covaxin (Bharat Biotech) – at a fixed price tag of Rs 150/dose. At this price tag, the Centre could procure about 30 crore vaccines by July against the advance payment to each the manufactures. It is yet another matter that vaccine makers have been pleading the government to boost its procurement price tag or give grants to step up productions.
“On behalf of the vaccine industry in India, I would like to thank and applaud Shri @narendramodi Ji, @nsitharaman Ji, for your decisive policy changes and swift financial aid which will help vaccine production and distribution in India,” SII CEO Adar Poonawalla tweeted on Tuesday.
The government on Monday announced a ‘liberalised and accelerated’ Covid-19 vaccination programme starting May 1, exactly where all above 18 years of age will be eligible to be vaccinated. Also, vaccine producers have been empowered to release up to 50% of supplies straight to state governments and in the open marketplace at pre-declared costs, a move that would increase availability of the prophylactics to the people today.
For Covid-19 vaccination, the Budget for FY22 has created a provision of Rs 35,000 crore to cover 50 crore people today (Rs 700/individual for two doses, like vaccine expense of Rs 400-500). But the existing costs fixed by the Centre are even reduced at Rs 500/individual for two doses. Depending on the vaccination roll-out, a funding pattern will be worked out involving the Centre and states and accordingly provisions will be created. If costs are revised upward, the spending budget provision could have to be enhanced to some extent or the states could be asked to foot portion of the vaccination bill.