In a bid to boost India’s efforts to find effective drugs and vaccines against Covid-19, the government is temporarily allowing investment in such efforts to be viewed as meeting corporate social responsibility (CSR) obligations from a company business.
What are the changes?
- This includes pharmaceutical, vaccine and medical device companies, which are expected to research and develop new drugs, vaccines and medical devices as part of their regular business operations.
- In the new amendments to the 2014 corporate regulations (corporate social responsibility), the Ministry of Corporate Affairs incorporated a provision that would allow companies to claim CSR benefits for these activities until the 2022-2023 fiscal year.
What are the amended provisions?
- The amendments temporarily remove a provision that would have excluded “activities carried out in the course of its (company’s) normal activities” from being considered as CSR activities.
- For now, companies engaged in “research and development of new vaccines, drugs and medical devices in the normal course of their activities” will be able to benefit from CSR benefits for their R&D work related to these product activities.
- Covid-19, provided that the work is “in collaboration with” one of the institutes or organizations mentioned in paragraph (ix) of Annex VII of the Companies Act 2013.
- In the normal course, these institutes and organizations, “or any other” central or state funds for socio-economic development and humanitarian aid, as well as funds for the welfare of registered castes, registered tribes, other backward classes, minorities and women.
- However, the ministry has also changed this schedule to replace it with incubators or research and development projects in science, technology, engineering and medicine that are funded by central government or the state, a public sector company or any other body government.
- Now it also includes publicly funded universities, Indian Institute of Technology (IIT), national laboratories and autonomous bodies established under the aegis of the Department of Atomic Energy (DAE), Department of Biotechnology (DBT), Department of Science and Technology (DST), Department of Pharmaceuticals, Ministry of Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homeopathy (AYUSH), Ministry of Electronics and Information Technology and others bodies such as the Defense Research and Development Organization (DRDO), the Indian Council for Agricultural Research (ICAR), the Indian Council for Medical Research (ICMR) and the Council for Scientific and Industrial Research (CSIR) ). “Details of this activity will be disclosed separately in the annual CSR report included in the board report,” the latest changes said.