Billed as India’s first bulk drug, chemicals and allied manufacturing parks and one of the most successful public-private partnerships (PPP) in the pharma sector, the Jawaharlal Nehru Pharma City (JNPC), also known as Visakha Pharma City, was set up in February 2005 as a PPP initiative by the Govt of Andhra Pradesh (GoAP) through its nodal agency Andhra Pradesh Industrial Infrastructure Corporation (APIIC) with the Ramky Group on a Build-Own-Operate (BOO) basis for 20 years.
A dream run
Reflecting back on the early days of JNPC, Dr Divakar Marri, VP & SBU Head – SPV, Ramky Infrastructure indicated that the gestation period from signing on to commercial operations was fairly minimal, thanks to the modular nature of the park design. As per Dr Marri, construction was initiated from 2005, commercial operations started in 2008, when companies began to sign on.
The 2400-acre JNPC became operational in 2010, with a second phase in 2019. By July 2023, JNPC was rated as leader (SEZ) with the highest level of aggregate performance category in the Industrial Park Rating System (IPRS) Report brought out by the Department for Promotion of Industry and Internal Trade (DPIIT).
As per the website, JNPC houses 104 operating companies, including MNC and domestic pharma companies and accommodates around 30,000 employees. The pharma city spans companies manufacturing bulk drugs, chemical and allied industrial units, with facilities to comply with all relevant national and global environmental and social standards and regulations.
JNPC reportedly includes leading global pharma companies like Pfizer Mylan Laboratories, Eisai Pharma, PharmaZell, and SNF. Most of India’s big pharma companies too have chosen JNPC, including Biocon, GVK Bio, Granules, Lauras Labs, Hetero Pharma, Aurobindo Pharma, and Orchid Chemicals and Pharmaceuticals.
As per the JNPC brochure, the project was reportedly designed to offer ‘a hassle-free production environment and allow pharmaceutical industries to save up to 40 per cent of the project cost by providing all the common infrastructure and clearances required. Apart from several infrastructure facilities and services offered, the park-level environmental and other clearances save two years in development for industries.’
Growth pains
Ironically, JNPC’s success also resulted in challenges. JNPC was a pioneer in a sense, as one of the first functional pharma cities in the country. Like most pharma manufacturing zones, the park faced growth pains as operations outgrew the facilities provided.
Around 2014, media reports indicated a tussle for power with the state electricity board, a key challenge for a continuous manufacturing sector like pharma. A Care Ratings Report on the Ramky Group dated October 23, 2020, flagged concerns about a Central Bureau of Investigation (CBI) litigation, initiated in FY13, related to reduction of green belt area in JNPC to create more saleable plots than the original masterplan.
Challenges of ‘red category’ manufacturing
Pharma manufacturing results in hazardous waste effluents which need rigorous treatment before release. This puts the industry in the ‘red category’ and most pharma manufacturing locations default on this count to various degrees.
Even though JNPC’s environmental infrastructure included a green belt of 353 acres, a 12 MLD capacity effluent treatment plant with multiple effect evaporator, a solid waste management facility, and a 20 MLD water treatment facility, there are indications that the park’s effluent treatment plant was stretched.
Newspaper reports highlight environmental and safety issues, like agitations of the local fishing community of dwindling catch due to insufficiently treated effluents. There have also been explosions at units within the plant, like the massive fire and explosion at Visakha Solvents in July 2020. Such reports caused the pollution control board to launch detailed inquiries. Local administration also paused further permissions to onboard new pharma companies in JNPC.
These challenges took some time to be resolved. JNPC’s experiences over two decades will no doubt help new upcoming pharma cities to develop more comprehensive measures and check and balances to avoid environmental and legal issues.
Signalling the next phase of JNPC, on March 30, 2026, RIL divested its 51 per cent stake in its subsidiary, Visakha Pharmacity, to Brij Gopal Construction for 165.24 crores.
RIL’s divestiture in Visakha Pharmacity was preceded by RIL being awarded Maharashtra Industrial Development Corporation (MIDC) has appointed Maha Integrated Life Sciences City (MILeS City), a wholly owned subsidiary of RIL.
While RIL simultaneously starts executing its next project, a lifesciences city in Maharashtra, this sale hopefully marks the start of the next phase of growth for the Ramky Pharma City, but will existing pharma companies prefer to migrate to newer pharma cities, which will have more updated infrastructure?
Given that most pharma companies have sizable revenues from contract manufacturing for overseas clients, they might prefer to migrate to newer bulk drug parks with more updated, automated facilities.
However, newly announced bulk drug parks have a long gestation and stabilisation period and will take a few more years to get fully operational. JNPC remains a template for today’s pharma cities, but needs to get back its mojo with a future-proof strategic roadmap.
Will the new partners Brij Gopal Construction set this uptick in motion? Only time will tell.
References
- https://visakhapharmacity.com/ cms/jnpc BSE filings
- PIB news: January 8, 2025: Prime Minister Shri Narendra Modi lays foundation stone, inaugurates development works worth over Rs. 2 Lakh Crore in Visakhapatnam, Andhra Pradesh
- https://www.casemine.com/judg ement/in/5d412e1e714d58414853 3768
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