India has authorized two Covid-19 vaccines for use, putting its enormous vaccine-manufacturing capacity in the spotlight. Large parts of the rich world may have something valuable to learn.
The Serum Institute of India is the world’s largest manufacturer of vaccines by volume, founded over 50 years ago by now-multibillionaire
It will likely provide not only almost all the vaccines administered in India, but many elsewhere in the world too, once exports are permitted later in the year.
Research by Fitch Solutions outlines three groups of Asian economies this year: Those that can plausibly vaccinate most of the people in priority groups such as health-care workers and the elderly by June, those that can do so by September and those that will take longer. India is by some distance the lowest-income country in the first group of economies, which includes Hong Kong, China, Singapore and Malaysia. Wealthier South Korea and Thailand will take longer.
The Serum Institute’s work requires a reliable and large domestic supply of the vials in which the vaccines are sealed and transported, ensured by companies such as Schott Kaisha and Piramal Glass. The existence of the world’s largest vaccine manufacturer helps to establish the basis for a domestic network of suppliers.
Global supply chains and international trade have actually held up remarkably well under extreme circumstances over the past year. There is no need to reshore enormous amounts of manufacturing capacity, and any attempt at even halfway autarky will make all parties involved—importers and exporters—less prosperous.
But countries could take a leaf from India’s book when it comes to manufacturing crucial items that might encounter massive demand surges, and where national priorities come to the fore. Doing so is unrealistic for every small and middle-size country, but production could be organized at the level of regional blocs such as the Association of Southeast Asian Nations. The pandemic hit Latin America harder than many other parts of the world, but its limited vaccine production means most nations there have a long wait ahead of them.
Such a company need not be a government enterprise. As noted, the Serum Institute was founded as and remains a private company, though it cooperates closely with the government. Establishing similar capacity could be achieved by cooperation on health-care regulation to create large regional markets, and the right financial incentives. The principle applies as clearly to personal protective equipment as it does to vaccines.
Many far richer countries have fretted about shortages of such vital components because they are usually imported, and supplies are now uncertain with demand sky-high. Given the achingly slow pace at which European vaccines are being rolled out, the Indian program may well end up as a model for the world.
Write to Mike Bird at [email protected]
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