Aurobindo Phrma to set up plant in S Arabia
11 Jan 2016
Among the largest vertically Integrated pharmaceutical companies in India, Aurobindo Pharma is setting up a manufacturing plant at Industrial Valley in King Abdullah Economic City (KAEC) in Saudi Arabia.
Aurobindo's investment arm has leased a site in Phase One of the Industrial Valley to build its maiden manufacturing facility in Saudi Arabia.
The facility will produce oral tablets and capsules.
The deal is part of an effort by the oil-rich kingdom to generate jobs for its citizens. Pharmaceuticals is among the thrust areas by the kingdom to attract manufacturers to set up manufacturing operations in Saudi Arabia.
Saudi Arabia, the world's largest oil exporter has run a record budget deficit of 367 billion riyals ($97.9 billion) for 2015 as low oil prices dented state revenues, the Council of Economic and Development Affairs said on Monday (See: Saudi Arabia sees $138-bn budget deficit for 2015 as oil plummets).
The country plans to shrink the record state budget deficit with spending cuts and a drive to raise revenues from sources other than oil.
''The decision to base our company's regional operations in Saudi Arabia came in response to the rising demand for our products in the [Arabian] Gulf,'' said Fahd Al-Rasheed, managing director and chief executive of KAEC.
According to Rayan Qutub, CEO of the Industrial Valley, Saudi Arabia's drug industry is, by far, the largest in the region.
"The entry of a leading international company of Aurobindo Pharma's caliber is yet another milestone in the Industrial Valley's success in attracting world-renowned pharmaceutical manufacturers, all thanks to the unrivalled value it has to offer. This further bolsters the Industrial Valley's status as the go-to destination in the Gulf for pharmaceutical investors.''
He added, Saudi Arabia has spent the equivalent of $7.5 billion on pharmaceuticals in 2014, "and yet the national drug industry has barely cracked a 20-percent market share,'' he continued.
The Industrial Valley currently hosts more than 100 companies, as an increasing number of global investors have come to see it as a prime location for investment. Given the unhindered access to King Abdullah Port, it is the key destination for inbound and outbound logistics and products in the region, with the capability to serve 250 million consumers in the Arab world and East Africa.