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Drafting of Medical Oxygen Production Promotion Policy, 2021

DDC Delhi participated in several deliberations with the Industries department and Delhi State Industrial and Infrastructure Development Corporation (DSIIDC) to draft the Oxygen Production Promotion Policy to incentivize the production of liquid/gaseous oxygen as well the procurement of relevant storage and transport infrastructure. 

In August 2021, Delhi Government notified and approved the Medical Oxygen Production Promotion Policy of Delhi, 2021. This policy is expected to provide a major boost to Delhi’s capacity to meet the requirement of medical oxygen in the future and make Delhi self-reliant in meeting any such crisis/medical emergency in the future.

Need for the Policy
The COVID-19 crisis fuelled by a new 2021 strain of the virus put enormous pressure on existing healthcare infrastructure, including medical logistics, in the NCT of Delhi. To ensure there is no shortage of medical oxygen in the wake of Covid 19, Delhi Government decided to frame a dedicated policy for the same.

Key Objective of the Policy
The objective of the policy is to increase the production of oxygen in Delhi by setting up either new manufacturing enterprises or expanding the production capacity of existing units for uninterrupted oxygen supply to hospitals or nursing homes during the health crisis caused by COVID-19 or otherwise. The policy also seeks to facilitate the storage and transportation of medical oxygen in Delhi.

The Medical Oxygen Production Promotion Policy of Delhi 2021 aims to ensure time-bound fulfilment of the targets such as setting up liquid oxygen (LOX) manufacturing facilities, non-captive & captive oxygen generation plants etc. In order to fulfil these objectives, several incentives are provided for early investment in the production/storage infrastructure for medical oxygen. 

Features of the Policy

  • The incentives for Liquid Oxygen (LOX) manufacturing plants / non-captive oxygen generation plants include capital subsidy on the cost of plant and machinery up to Rs 20 lakhs per MT of installed capacity and 100% reimbursement of stamp duty and gross SGST within a month of commissioning of the plant.
  • Power subsidy has also been made available to liquid oxygen generation plants and non-captive oxygen generation plants at Rs 4 per unit consumed in the manufacturing process for the first five years from the date of commencement of commercial production. 
  • Cryogenic tankers of a minimum 10 MT carrying capacity for the exclusive purpose of ferrying liquid medical oxygen (LMO), up to 500 MT capacity; and LMO storage tanks of a minimum of 10 MT capacity, up to 1,000 MT capacity, have also been included in the policy.
  • The minimum lock-in period for the beneficiaries under this scheme shall be five years.