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Local Innovation and Production System in Indigenous Medicine:

The Case of Ayurveda in Kerala, India

May 2013

Report prepared by:

K J Joseph (Centre for Development Studies, Thiruvananthapuram) Dinesh Abrol (National Institute of Science, Technology and Development Studies, New Delhi) Harilal Madhavan (Azim Premji University, Bangalore)

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Local Innovation and Production System in Indigenous Medicine:

The Case of Ayurveda in Kerala, India1

K J Joseph (Centre for Development Studies, Thiruvananthapuram)

Dinesh Abrol (National Institute of Science, Technology and Development Studies, New Delhi) Harilal Madhavan (Azim Premji University, Bangalore)

Abstract

This paper analyses how the local system of innovation and production in indigenous medical knowledge

operates in the state of Kerala in India and locates varied spaces of exclusions therein. The local production networks, innovation capabilities and social innovation process are explored within Indigenous medicine sector

of Kerala through an analysis of fifty firms in Thrissur and an Ayurvedic cluster namely CARe Keralam.

Additionally, a few indigenous healers and medicinal plant collectors are interviewed to explore the supply

chain nodes and geography of labour. The study argues that the policies during the early period, especially

colonial period favoured biomedical paradigm and excluded indigenous system. The post-independent policies

have largely nourished the commercial aspects of the indigenous system, while ignoring the therapeutic values,

hence resulting in an elusive inclusion. The geo-political context of scientific dominance sustained this

exclusion. It also argue that unlike the given notion, innovations could have global as well as local implications

and it does not necessarily be given from outside. The industrial transformation of indigenous knowledge has

diversified the use of knowledge into not only medicine, but nutraceuticals and cosmetics, representing the

most demanded global commodities. The sector, while putting forward a strong local and production system (LIPS-IM continues to face multiple exclusions and institutional bottlenecks. At the same time, there is evidence

to indicate that the traditional practitioners are mainly making use of local health knowledge for public health

benefits, based on trust and time tested efficacy. This challenges the perceived notion of published scientific evidence for acceptance of medicine and underlines the importance of outcome based evidence system. The study describes the importance of getting institutions right for an inclusive commercialization of traditional medicine/knowledge. The potential of LIPS-IM is highlighted by addressing varied infirmities like weak

institutional architecture, like low level of interactive learning along with low investment in R&D and scarcity

in raw material supply.

Key words: Ayurveda, local Innovation System, health innovations, India, Kerala

1 The senior authorship is shared by the three authors. We sincerely acknowledge the help extended in the field

by Dr. Hareesh, Dr. Ranjith, Dr. Ramanathan, Dr. Sheela Karalam, Mr. Raman Karimpuzha among many others.

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Contents

1. Introduction: The Background 2. Analytical framework 3. Active Exclusion to illusive Inclusion: National and International Context of IM

3.1 International Context

3.2 National Context 4. IM in Kerala: Evolution, growth and Present structure 4.1 Institutional Mechanism for the development of Ayurveda in Kerala

4.2 Kerala Ayurveda in Transition

4.3 Present scenario

4.4 Changing Production Relations and Multiple Markets

5. The innovation and Production Linkages: the empirical evidence 5.1. Institutions, Labour and Cost in Raw Material Nodes

5.2. Employment Structure of the Industry and Traditional Physicians

5.3. Dynamics of interactive Innovation

5.4. Networking, up-gradation and Social innovations: CARe Keralam Case

6. Cases of Inclusion 6.1 Innovations and Disease categories

6.2 Family Linkages, Niche Market and Capacity Creation

6.3 Social Inclusion through Livelihood: A Revisit to the Jeevani Case

7. Conclusion and Policy Directions 8. References

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1. Introduction: The background

It may appear paradoxical that there is heightened concern on growing inequality in a context wherein

economies across the world are being driven by greater access to science, technology and innovation.

Scientific and technological development has created immense capabilities in the current world, which however, coexist with growing poverty rates, poor living and health conditions for a significant

part of world population. This tends to suggest that the benefits of science and technology to

development are neither automatically nor equally distributed among or within countries. Therefore,

besides the current broad recognition of the relevance of science and technology for promoting economic development and competitiveness, it becomes imperative to advance in such debate in order

to include their role for fighting inequality and promoting social inclusion (Soares; Scerri; Maharajh,

forthcoming). Since the benefits of modern science and technology are not automatic, institutional changes and incentives will have to be designed appropriately to upgrade the local systems of

innovation and production. Further, it is also recognized that the interventions are going to be framed

in the context of ongoing globalization of the systems of production and innovation. Keeping this

context in view the present study explores the dynamics of development of the local system of innovation and production in Kerala Ayurveda.

Analysis of the Indian experience, suggests that the extent to which the innovation system reinforced or undermined inequality has been governed to a great extent by the forces that drive the innovation

system (Joseph et al 2013). During the first phase of the evolution of Indias innovation system, driven by the state with the declared objective of growth with equity, there were a number of institutional arrangements that helped mitigating inequality. Achievements in the sphere of equality,

however, turned out to be at the cost of growth. During the second phase of its evolution, wherein

innovation system was driven by market forces with a view to facilitate growth for equity, there appears to have been a tendency towards the weakening of institutions working for equity. Indeed there has been a remarkable turnaround in growth but at the cost of equity. No wonder, the issue of

inclusive growth today figures at the centre stage of development discourse and the focus of policy

pendulum shifted from growth to inclusive growth wherein the local systems of innovation and production are expected to play a critical role.

The pioneering work on national system of innovation (Freeman 1987, Lundvall 1992, Nelson 1993) and the subsequent developments in the literature on systems of innovation at regional (Asheim and

Gertler, 2004), sectoral (Malerba, 2004) technological (Carlsson and Stankiewitz 1995) and corporate

levels (Granstrand 2000) deviated from conventional linear approach to technological progress and

placed innovations at micro, meso and macro level as the driving forces behind growth. The moot question is; if innovation breeds growth, could it also be instrumental in fostering inclusive

development? While the linkage between innovation and growth appears fairly straight forward, the

issue becomes more complex when it comes to innovation and inclusive development or its twin foundations (in) equality and poverty. As argued by Cozzens and Kaplinski (2010) while innovation is of course not the only or even main influence on inequality, it is nonetheless often causally linked

to poverty and inequality through many different economic, social, and political processes - but not in

just one direction. Hence if innovation were to promote inclusive development, the underlying innovation system has to be quintessentially inclusive. The RISSI project, while recognizing the role

of innovation system, underlines the fact that the search for the factors and forces that give rise to

varied spaces of exclusion has to be at the micro level with focus on local innovation and production system as a society embedded process.

The present study focuses on the local system of innovation and production by examining the Society and State embedded processes in the case of the development of Indigenous medical system in Kerala.

Keralas development experience has attracted world attention on account of its human development indicators comparable even to the developed countries with a low per capita income. This has often

been attributed to public action and varied social sector innovations and those pertaining to governance. Amartya Sen (1999) observed that thanks to public provisioning, despite the very low

levels of income, the people of Kerala, or china or Sri Lanka enjoy enormously higher levels of life

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expectancy than that of the much richer populations of Brazil, South Africa, Namibia and others. He

further observed that while Keralas impressive achievements in low fertility, high life expectancy, high literacy and so on are worth celebrating and learning from, the question remains as to why

Kerala has not been able to build on its success in human development to raise its income levels as

well which would have made its success more complete.

However, the impressive growth in GDP in the recent years notwithstanding, the State could hardly

generate enough resources to pay for the social sector expenses to sustain the legacy of high social

development. The shrinking resources of a fragile economy, marked by a high degree of governance deficit have ultimately led to a decline in the quality of public services. While the development failed

to address the needs of weaker sections of the society - SCs, STs, fishermen and artisans and they remained as outliers, other marginalized segments of the society like the mentally and physically challenged had to contend with the state of neglect as ever. Second generation problems like ageing,

along with new diseases have surfaced in such high magnitude calling for additional social sector

expenditure. Though private participation in social sectors like health and education increased

overtime, issues in equity and excellence have surfaced. While the better endowed became more affluent by exploiting the opportunities offered, among others, by globalization, the less privileged got

further immiserised. Thus, a state known for its equity has become the most iniquitous state in the

country. The estimated value of Gini coefficient using the NSS consumption data in Kerala declined from 0.35 in 1983 to 0.32 in 1993 and was comparable to that of all India average (0.31). But by

2009-10 it increased to 0.48 in Kerala as compared to the national average of only 0.36. Going by the

available data, along with increasing interpersonal inequality inter regional (districts) inequality also has been on the upward trend. All these cannot be delinked from the varied spaces of exclusion.

Along with inequity in consumption inequality in the access to health care services also accentuated

especially in a context wherein the state, given the financial constraints, has been increasingly withdrawing from the public provisioning of health care services with increasing role being assigned

to the private sector. In Kerala, many developments such as growing literacy, increasing household

income and population ageing (leading to increased numbers of people with chronic afflictions), probably fuelled the health care demand. Since the government institutions could not grow in number

and quality at the required rate, health sector development in Kerala after the mid1980s was dominated by the private sector (Kutty and Panikar 1995)

2. This seems to have an impact on the

affordable healthcare. In a recent survey, Jean- Frederic Leveque et al (2007) noted that hospital care involves paying admission fees in 68 per cent of cases involving hospitalisations (98 per cent in

private and 20 per cent in public sector) in urban Kerala. Poor households and those headed by casual

workers show significantly lower levels of health expenditure and a higher proportion of health-related loss of income than other social groups. The utilization of public services by the poor accounts

approximately to their share in population (Mahal et al. 2001) and health expenditure pattern suggests

that the Kerala health system favours the rich (Kutty 1989).

Table 1 shows that recently, private sector contributes more than 82 percent of medical institutions

and 57 percent of the beds, reversing the situations of two decades back. This has to be read along with the fact that while the government sector has made available only 25 per cent of its beds in rural

areas, that of by the private sector in the rural areas is as high as 53 per cent (Kannan et al 1991).

Since private sector has a greater number of hospitals and a large per cent of these have inpatient facilities (45.66 per cent in 1995), it is obvious that it is the private sector, which ensures adequate

inpatient facilities for rural population. While the government has deployed only 64 per cent of their

2 It is argued elsewhere that the expansion in private facilities in health has been closely linked to developments

in the government health sector. Public institutions play by far the dominant role in training personnel. They

have also sensitized people to the need for timely health interventions and thus helped to create demand. At this

point in time, the government must take the lead in quality maintenance and setting of standards. Current

legislation, which has brought government health institutions under local government control, can perhaps facilitate this change by helping to improve standards in public institutions (Kutty 2000).

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health staff in urban areas, the private sector has 50 per cent of their staff in rural areas. Thus the

private sector has stepped into mitigate the impact of urban bias of the government sector. So one of the stated purposes of the government intervention (serving the rural households), appears to have lost

its purpose (Sadanandan 2001) with its implications on inclusive health care service provision.

Table 1: Distribution of Institutions and Beds: Public and Private Sector (in %)

Year Public Private

Institutions Beds Institutions Beds

1976 53.32 58.82 46.68 41.18

1986 23.23 40.5 76.77 59.5

1995 22.7 36.22 77.3 63.68

2005 17.27 43.09 82.73 56.91

Source: Government of Kerala, 1985, 1995, 2005

It is also evident that in terms of beds availability the ayurveda has been increasing over time both in the private and public sectors. Table 2 indicates that during 1986-2004 the availability of bed per

10000 population in allopathy has declined marginally and that of ayurveda increased nearly three

times albeit from a low base indicating increased preference for ayurveda by the people. It is also

observed that much of this increase was on account of the private sector wherein the number of beds availability per 10000 population recorded more than threefold increase as compared to twofold

increase in the public sector.

Table 2: Beds per 10,000 People in Kerala

Systems of Medicine 1986 2004

Public Private Total Public Private Total

Allopathic 12.7 18.4 31.1 11.9 17.4 29.4

Ayurvedic 0.6 0.5 1.1 1.2 1.7 2.9

Homoepathy 0.3 0.1 0.4 0.4 0.2 0.6

Others 0 0.1 0.1 0 0.3 0.3

all systems 13.6 19.1 32.7 13.5 19.7 33.2

Number 36278 50766 87024 44192 64491 108683

Source: DES (1989 & 2004), State Planning Board (1986 & 2005)

Note: Private Bed from DES; Public Beds from State Planning Board

It is seen that in many districts like Idukki and Wayanad, where the public provision of health

resources remained poor, the private sector has favoured in filling the gap. The absence of government legislation relating to hospital start-up, running and profit generation has been a feature

Kerala shared with most states in India, but high demand for healthcare in Kerala probably provided

the impetus for private sector to correct the government failure in the provision of health services until recently. But, this invariably, may increase the cost of healthcare access.

Since the credit for better health indicators of Kerala has often been attributed to public action and

varied social sector innovations and those pertaining to governance, there is also the suggestion from scholars that the factors like education, political participation and biomedical interventions do not

operate in conflict with ayurvedic health culture and a part of this credit should go to the practice of

ayurvedic health culture in Kerala (Abraham, 2009). In such a context a study of the local system of innovation and production in ayurveda wherein Kerala has profound claims of tradition, practice and

institutional build-up assumes added significance. Studies have shown that indigenous medicine has a

balancing role during escalating healthcare costs and it is quite evident that for long term and short

term morbidity, a substantial number of people prefer traditional healers especially in the rural areas (NCAER 2009). Despite formally recognising Indian systems of medicine, state has not formulated

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any clear policies to utilize its services in providing public health care in India, even though it

represented in the recent National Rural Health Mission. Although marginalised by the medical discourse and neglected by the State for over a century, Ayurveda and other ISMs not only survived

but has emerged as a powerful sector in the field of health care.

2. Analytical framework

Traditional Indian Medical System3 has a coexistence of many expert and lay perspectives on health

and disease embedded to constitute a pluralistic healthcare system. Within each system of medicines,

there are number of agents whose work, complement each other and contribute to better health

outcome. These interactions and exchanges bring in changes in the operations and functioning of the system over time. Contemporary transformation in Ayurvedic healthcare system

4 is mostly led by

agents such as mass manufacturing firms, graduates in Ayurvedic medicine, practitioners who often

belongs to prestigious family- lines of traditional healers, government research and scientific organizations, civil society and the state institutions. The LIPS framework in the indigenous medicine

sector in Kerala (LIPS-IM) is presented in Fig 1.

3 Traditional Indian Medicine (TIM) refers to systems like, Ayurveda, Siddha, Unani and other folk systems in

India. The terms traditional Medicine and indigenous medicine are used in the article interchangeably unless

specified. In India, such system together is under the national government, department of AYUSH (Ayurveda,

Yoga, Naturopathy, Siddha, Homeopathy and Tibetan Medicine). The term modern medicine, biomedicine,

allopathy are used in various contexts to denote conventional medicine. 4 Ayurveda is often referred to as the oldest system of medicine in India. Its origins can be traced back to Vedic

and Buddhist medical knowledge, which might have in turn originated from folk healing traditions. The texts

that crystallized Ayurveda in its present form were Sushruta Samhita by Sushruta (probably before 700 BCE),

Charaka Samhita by Charaka (1st century CE), and Ashtangahrdayam by Vagbhata (8th century CE). Ayurveda

is based on the concept of the tridosha that are a set of parameters, which are physico-chemical and functional in nature, imbalances in which are thought to result in various ailments. Materials of plant origin were primarily used in the preparation of medicines, while those of animal and mineral origins were also utilized.

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Figure 1: The LIPS-IM in Kerala

The major stakeholders at the core are Ayurvedic manufacturing firms, medicinal plant collectors, traders and other middle men, the cluster - Confederation of Ayurvedic Renaissance (CARe Keralam),

the marketing outlets and agencies and Consumers etc. The Ayurveda, Yoga, Unani, Siddha,

Homeopathy and Tibetan medicine (AYUSH) centres, research councils, traditional knowledge

holders, state medicinal plant boards and Ayurveda colleges also work as important stakeholders. In the case of Ayurveda, CARe Keralam is one of the major bonding institutions, as it represents a

public-private consortium dealing with promotion of Ayurveda, offering raw material supply,

standardization and intellectual property access, technology assistance etc. These major actors are influenced by the policies of the central and state governments, guidelines of international

organizations and conventions like WHO, WIPO and CBD and policies of destination or importing

countries etc. Very often, even the innovations of products are incentivized and shaped by these international stakeholders. Due to the stringent regulations on scientific evidence, many traditional

medicine drugs are not entering the foreign market as medicinal products, but as nutraceuticals, which

needs only standardization and toxicity checks but not efficacy claims. If drugs are entering the

European markets and US markets as nutraceuticals or food supplements, the formalities of drug efficacy and evidence of strong published documents could be circumvented.

Since there are a number of actors involved in the local health system, it is important to explore nature of productive interactions between different stakeholders like government organizations, academic

community and other, the nature of innovative activities undertaken and their outcomes and more

generally how the system coevolves in response to changing institutional context and demand

conditions. Given the national and international background of bourgeoning demand for herbal products, we attempt to look beyond the phenomenon of pharmaceutical episteme5 (Banerjee 2009)

5 Banerjee (2009) describes that the new developments in Ayurveda are mostly oriented towards a

pharmaceutical episteme, in which the commodified forms of ayurveda is getting dominance in national and

international scene and most of the policies in Ayurveda also pushing the idea of production, while ignoring the entity of systemic knowledge.

Industrial Policies, biodiversity Act, ISM&H

Policies Productive

infrastructure

International and foreign policies in Indigenous

medicine Geopolitical, social and international context

National S&T infrastructure

CARe Keralam (the cluster)

Raw material collectors/ traders

or cultivators

Ayurvedic

Manufacturing Companies

Market for Ayurvedic

drug, distribution and commercialization

Flow of goods and services Information flows

Main Productive chain LIPS Social, political and civil organizations

State medicinal plant

boards Funding from Govt. of

Kerala, AYUSH and others

Ayurveda Colleges and Research organizations

Consultancy centres, NGOs etc

Traditional practitioners

Final consumer /

patient

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in Ayurveda with a close analysis of the sector in Kerala in general and Thrissur district of Kerala

specifically, to map the positioning of ayurvedic medicine in terms of innovations, production networks and promotion of social inclusiveness.

There is growing demand for ayurvedic medicines and related products in the Indian market. During

1992-2005, the industry in Kerala registered a compound annual growth of 10-12 percent and contributed around three percent value addition annually to the manufacturing sector (Madhavan

2009). There is modernization within the sector due to various types of innovations driven by demand

both from within and outside the country for ayurvedic products and hence new structures are created. At the same time a parallel niche market for traditional ayurvedic care depending on its legacy is also

serving a large public. These two structures, complementary to the mainstream biomedical paradigm,

have a large number of stakeholders, while interact themselves, though minimal very often, under the changing organization and policy contexts, also creates spaces on social exclusion.

Innovations6 in the case of ayurvedic sector could be of three types: First in terms of varieties and

range of products in the market. They are mainly; i) Shastric innovations, where the textual formulae of classic ayurvedic texts are used to develop ayurvedic drugs, which follows the mode of preparation

and adhere to the dietary regimes prescribed in those. These medicines are produced both by

organised manufacturing units or unorganised traditional physicians. Innovations could be in the form of introducing the known formulations from the traditional texts in a nuanced form, which serves

palatability or shelf life. (E.g.: bottled dasamoolarishtam, lehyams, asavams, arishtams, various forms

of capsules etc). ii) Proprietary products, where, innovations are mainly in the form of new processes or new combinations or new markets. These products hold exclusive marketing rights, but mainly

focusing on the middle income groups. This is mainly produced by slightly altering the basic textual

formulations (E.g.: Dabur chyawanparasam, Kamilari, Pankajakasthuri granules etc.) iii) this is very

recent trend in some of the ayurvedic pharmaceutical companies, which is called reverse engineering in ayurvedic formulations, in which the ingredients of the formulations, its properties and actions are

identified, analysed separately for their role in pathological research in Ayurveda and hence come up

with new formulations which fits in to the allopathic nosology iv) Poly-herbal combinations, through ethno-botanic knowledge, where innovations are in the form of new products based on the knowledge

provided either by traditional tribal groups or physician families (Jeevani).

We have historical evidences of local innovations in the ayurvedic system in the Kerala state, developed by Kottakkal Arya Vaidya Sala, in the case of Vishuchikari, during 1960s, which

contributed to the public health interventions during the cholera epidemic time (Varier 2002).

Importantly many ayurvedic pharmaceutical firms in Kerala are known for their product brands and have at least one flagship product. This targets and caters to the larger middle and lower class market.

Besides the contribution of a large number of medicines, many celebrated food supplements available

over the counter. Surprisingly, it does not confine to the domestic market, but found an entry into many overseas markets with strong Diaspora presence. This leads to the second category of

innovations; i.e. finding new markets. Ayurvedic medicine has overtime transformed from a very

patient-centered medicine to a rejuvenative healthcare therapy projecting more of its health and

beauty promotional aspects to suit the global markets.

6 Along with the definition of LIPS definition of innovations, this study uses innovation in a Schumpeterian

(1934) sense to analyse the broader identification of innovative activities; It could be; 1)The introduction of a

new good or of a new quality of a good, 2)The introduction of a new method of production, which need by no

means be founded upon a discovery scientifically new, and can also exist in a new way of handling a

commodity commercially, 3) The opening of a new market, that is a market into which the particular branch of

manufacture of the country in question has not previously entered, whether or not this market has existed before,

4) The conquest of a new source of supply of raw materials or half-manufactured goods, again irrespective of

whether this source already exists or whether it has first to be created and; 5) The carrying out of the new

organization of any industry, like the creation of a monopoly position (for example through trustification) or the breaking up of a monopoly position.

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The third segment of innovations is in the organizational linkages. When the market dominated as the

prime element of expansion and recognition of ayurvedic system, the production relations got redefined, the curriculum and training got redesigned and institutionalized, research methodologies

got integrated and also new forms of production network got formed. This has major implications in

treatment methods, pricing policies, targeted consumer groups and even in the presentation of health

system itself.

The analysis highlights two levels of inclusiveness/ exclusiveness of the system; first is through cost

effective healthcare access and the second refers to the nature of inclusion of traditional physicians in the course of new forms of integration. Here innovation is understood as localized, context specific

and socially determined process reflecting the cultural and historical trajectories. To Nelson (1993),

innovation should be understood as the process by which firms master and implement the design and production of goods and services that are new to them, irrespective of they are new to their

competitors domestic or foreign, is particularly important for the analysis in less developed countries. Here, the firm was re-conceptualized as an organization embedded within a broader socio-

economicpolitical environment reflecting historical and cultural trajectories. This understanding helps to avoid an overemphasis on R&D in the innovation process, encouraging policy-makers to take

a broader perspective on the opportunities for learning and innovation in small and medium-sized

enterprises and in the so-called traditional industries (Mytelka and Farinelli, 2003). Here, innovation as a localized, context specific and socially determined process implies, for instance, that acquisition

of technology abroad is not a substitute for local efforts. Local Innovation and Production System

(LIPS) would be a distinctive framework to analyse the complex interactions within the sector. LIPS framework is defined as an analytical framework for understanding the processes of generation,

dissemination and use of knowledge and the productive and innovative dynamics. It encompasses an

ample set of economic, political and social actors and their interactions, including: producers of final

goods and services; suppliers of raw materials, equipment and other inputs; distributors and marketers; workers and consumers; organizations focused on education and training of human

resources, information, research, development and engineering; support, regulation and financing;

civil society, cooperatives, associations, unions and other representative bodies (Redesist 2008).

To the extent that the present study intends to locate varied spaces of exclusion within LIPS, it is also

of relevance to reflect the plausible analytical categories of exclusion. Neither exclusion, both

economic and social, nor the attempt towards understanding its dynamics is new. When Adam smith talked about not being able to appear in public without shame, he was referring to nothing but

exclusion. In the Indian context, though the term inclusive development has become fashionable only

in the recent years, the need for socially and economically equitable growth has been underlined in her constitution and directive principles and was at the heart of different five year plans.

Since economic and social exclusion is the problem we want to address, Amartya Sens taxonomy of exclusion appears to be especially illuminating. Sen (2000) considers four situations; (i) constitutive

exclusion happens when being excluded is in itself a deprivation which can be of intrinsic importance

on its own; (ii) instrumental exclusion refers to causally significant exclusions that may not be

impoverishing by themselves, but can lead to impoverishment of human life through consequences of great instrumental importance; (iii) active exclusion happens when exclusions come about through

policies directly aimed at that result; (iv) passive exclusion is the result of policies that have not been

devised to bring about that result but nevertheless have such consequences.

Of the four above the first two appears to be based on the outcome where as the latter two are based

on the causes of exclusion. Viewed in terms of the nature of exclusion we could also have sustained exclusion vs transient exclusion. Very often development strategies might necessitate certain extent of

exclusion especially if unbalanced growth strategy is adopted as proposed by Hirschman (1958).

Such strategies might result in an inevitable exclusion of some for some time. This may be termed as

transient exclusion. However, if exclusion do not remain as a short term phenomenon and excluded remain as excluded for long we have cases of sustained exclusion which is socially more painful. We

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could also have subordinated inclusion and illusive inclusion depending on how the inclusion takes

place and how the returns to inclusion are being distributed. The former occurs when inclusion takes place in such a way that the gains from inclusion are not equally distributed. Instances of subordinated

inclusions could be observed in wide range of contexts from international agreements to local level

policy-decisions concerning ordinary citizens. While it could also result from the inability of those

included to take advantage of the benefits due to lack of capability, in its ultimate analysis it could be the manifestation of the power relations in the society. Illusive inclusion occurs when inclusion is

ensured but the outcome is not different from that of being excluded. To the extent that those included

hardly derive any benefits inclusion is illusive. Here the systems work in such way that the benefit of inclusion is confined to select privileged. We must hasten to state that these conceptual categories are

not always mutually exclusive. For scholars involved in exploring innovation system from the

perspective of inclusive development these conceptual categories might serve as pedagogical scaffoldings to understand varied spaces and exclusion and their multifaceted dimensions (Joseph

2012).

Survey and Method

In this study, as mentioned in the outset, we look at the state of Kerala in general and the district of

Thrissur in particular (Thrissur is one among the 14 districts of the state of Kerala) to analyze the system of production and innovation, interactive learning, the bottlenecks of innovation, agential

transformation and resultant new networks in bringing up an alternate health innovation system,

which is more inclusive in nature. Then we attempt linking the potential of an inclusive development and initiation of pro-poor healthcare system by effectively tackling the dents.

To explore the local innovation and production system, we have undertaken a primary survey of 50

ayurvedic firms in Thrissur district (see fig 2). The sample selection was facilitated by the information on the firms from Ayurveda Manufacturing association of India (ADMA) and

Confederation of Ayurvedic Renaissance (CARe), the Kerala consortium for promotion of Ayurveda.

Since these two organizations represent the manufacturing companies all over Kerala, the basic contact details of firms were collected regarding the companies in Thrissur district. Out of the total

155 firms, a stratified sampling was done based on criteria like market share (to represent both small

and large companies); the regional balance in Thrissur, the traditional families, new physician families and business groups.

We have taken of sample of 50 firms keeping in mind the broad categorization of large, medium and

small size in terms of turnover. Both objective and open-end questions are used to elicit information like turn over, exports, types of drugs produced; human resources or labour used; the usage, source

and problems of collection and cultivation of raw material etc. For the specific purpose of the study, a

detailed analysis has done on the interaction, collaborations and learning, R &D and innovation, source of risks, standardization and problems of three firms like Vaidyaratnam, Oushadhi and SNA

Oushadhasala through interviews and focus group discussions. Interviews with secretary of AIDMA

and director and chief of Care Keralam (the consortium of ayurvedic medicine manufacturers) were useful to explore the practical difficulties in management. A few medicinal plant vendors were also

interviewed to study the channels of supply. Vaidyamatom, a major traditional ayurvedic family was

visited to explore how a traditional sector has been negotiating the perceived change in the sector. The

study interviews and field visits were undertaken during November-December 2012.

Figure 2: The LIPS Territory: Kerala and Thrissur

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The selected units were classified as small, medium and large based on their annual sales turnover,

i.e., less than ten million (small), between 10 and 30 million (medium) and more than 30 million

(large) Table 3). Thrissur forms a typical representation for analysis, due to the following factors: the presence of traditional physicians in large scale, growing number of ayurvedic medicine

manufacturing companies which constitute highest in the state of Kerala, the well-established

medicinal plant market and raw material delivery system, the effective inter-linkages between the communities, state, firms and other stakeholders of the sector. This phenomenon actually led to a very

many nuanced development in the sector, including the herbal cluster formation and many corporate

entry into the system. In the study, we mostly concentrate on Ayurvedic sector.

Table 3: Distribution of Sample Firms by Turnover 2010-11

Turnover (in Million Rs) Number of sample Firms

Less than Ten Million (small) 32 (127)

Between 10 and 30 M (medium) 5 (20)

Above 30 M (large) 3 (8)

No Response on Turn over 10

Total 50 (155)

Note: Figures in the parenthesis indicate total number of firms

Source: Primary Survey (2012)

Most of the firms (90%) in Thrissur are small firms with the annual turnover of less than Rs. 10 million. A few firms like Oushadhi (publically owned), Vaidyratnam and Seetharam are able to find

external markets and hence diversified production into many new proprietary and other categories of

products like nutraceuticals, beauty enhancing products. Still the industry produces a large number of classical medicines. Unlike the firms in other places and different states, it may be argued that

Thrissur firms are even now concentrate more on the traditional formulations7. Still Thrissur has a

7 The major Classical products are Arishtams7 (Dasamooolarishtam, Jeerakasrishtam, Abhayarishtam, Balarishtam etc), Bhasma (Calicinated drug), Churna (Powdered herb), Ghrita (Ghee based), Gulika (Pill),

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major share in the Rs. 6000 million Kerala ayurvedic industry and the lone Kerala governments Ayurvedic firms, Oushadhi is situated in the district. But compared to the south of Kerala, Thrissur Ayurveda does not have much influence from the opportunities of health tourism.

Table 4: Year of establishment and family lineage

Establishment Number Having a family Lineage

Before 1950 11 11

Between 1950-80 17 16

Between 1980-2000 15 9

After 2000 7 2

Total 50 38

Source: primary survey (2012)

This may be due to the fact that large number of contemporary firms in Thrissur can trace back their

lineage to the familial practice of pure traditional Ayurveda and gurukula8 education. Table 4 which

highlight the family lineage suggest that out of the 50 firms surveyed 38 are having family lineage.

Between the 13th

and the 17th

centuries, with generous royal and individual patronage, a fertile intellectual milieu developed around temples in Kerala, especially in the Nila valley region in Malabar

(in and around Thrissur), where scholarship and scientific research on medicine, mathematics and

astronomy made significant progress. The Ashtavaidya culture evolved in this environment (Menon and Spudich 2011). Diabetes (prameha), blood pressure, hypertension, hypotension, rheumatoid

arthritis (amavatham) , vatharaktham , asthma (thamaka swasam) , infertility (anapathyatha) , life

style and degenerative diseases , etc. are most often confronted diseases in Ayurveda, as mentioned by

the units and hence efforts are also for the betterment of treatment in these categories.

It needs to be stated that the response in general was poor from firms in general especially the smaller

ones were not willing to share the firm specific information that we have asked for. Nonetheless, most of the firms were willing to share their concerns and highlight the issues that they confronted in

day today operation.

3. Active Exclusion to Illusive inclusion: International and national background

As Banerjee (2004) mentioned, the case of ayurvedic pharmaceuticals in the globalised period is not a

story of debris of an industry, which is ruined by the entry of a large number of global goods and it is also not a story of opening of an infinite gains in the world market with globalisation. It is argued that

it did not undermine the opportunities certainly found, but with a large number of weak negotiations

and acceptance of the biomedical templates compromised the highly valued cultural alternative views,

and relegated it to a marginal player. And even though many international and national organisations have constituted a large number of taskforces and committees to enquire into the possibility of

inclusion of indigenous systems in mainstream healthcare, it largely rest in the paper. For instance,

the traditional birth attendance found importance in many countries policy documents, at the implementation level, it was completely ignored. We, here, briefly look into some of the attitudes and

Kashaya (Decoction), Lehya (Electuary), Rasakriya (Collerium), Thaila / Kuzhampu (Oil based) etc. The

proprietary drugs are of many types and most of the firms have one flagship products in the proprietary

category. The anti-diabetic drug of Vaidyaratnam namely Mehanil, Pramehaushadhi for Oushadhi and

balasudha for Balasudha ayurvedics etc are some of the examples. 8 Gurukula is a type of school in India, residential in nature, with pupils (shishya) living near the guru, often

within the same house. In a gurukul, shishyas live together as equals, irrespective of their social standing, learn

from the guru and help the guru in his day-to-day life. The guru-shishya tradition (parampara) is a hallowed one in Hinduism and appears in other religious groups in India, such as Jainism, Buddhism and Sikhism.

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concerns of international and national institutions in terms of traditional medical knowledge as a

source of healthcare.

3.1 International Context:

Until the 1980s, development planning was usually based on very negative assumptions about indigenous knowledge societies. But slowly, they became major part of many developing country

policy networks due to their cultural richness, their sophisticated natural resource management

expertise, and their agricultural and health-related knowledge9. The more enlightened attitudes

towards the knowledge, skills, and subsistence practices of rural communities in developing countries

emerged, according to Adams, as part of a liberal and populist reaction against the unsuccessful technological triumphalism of rural development practice. These attitudes have become increasingly mainstreamed in academia and among international development and conservation agencies. Since the

1990s many multilateral and bilateral donor agencies, including the World Bank, have come to

recognize and actively promote the role of local knowledge in sustainable rural development

programs. Local knowledge is mostly intrinsically motivated and devoid of any external impact. Also, many conservation and development agencies consider what the 1992 Convention on Biological

Diversity refers to as the knowledge, innovations and practices of indigenous and local communities embodying traditional lifestyles as a hitherto barely tapped source of ideas and techniques that can be harnessed to pursue more sustainable paths of development.

In this context, there is a recent recognition on the need to develop the innovations based on the Traditional medicine and 61

st World Health Assembly of WHO has reiterated on the same with a

focus on the issues. It says;

Supporting policies that will promote innovation based on traditional medicine within an evidence-based framework in accordance with national priorities and taking into account the relevant provisions

of relevant international instruments, the emphasis is on: (a) Establish and strengthen national and

regional policies to develop, support, and promote traditional medicine (b) Encourage and promote policies on innovation in the field of traditional medicine (c) Promote standard setting to ensure the

quality, safety and efficacy of traditional medicine, including by funding the research necessary to

establish such standards (d) Encourage research on mechanisms for action and pharmacokinetics of

traditional medicine (e) Promote South-South collaboration in traditional medicine (f) Formulate and disseminate guidelines on good manufacturing practices for traditional medicines and laying down

evidence-based standards for quality and safety evaluation. The World Health Organizations Commission on Intellectual Property and Innovation in Public Health has recognized the role of traditional medicine in drug development for affordable health

solutions. Development of standardized, synergistic, safe and effective traditional herbal formulations with robust scientific evidence can also offer faster and more economical alternatives. For instance,

Ayurvedic texts include thousands of single or poly-herbal formulations. These have been rationally

designed and have been in therapeutic use for many years. Sufficient pharmaco-epidemiological

evidence, based on actual clinical use, can be generated to support their safety and efficacy. Systematic data mining of the existing formulations huge database can certainly help the drug discovery processes to identify safe candidates and synergistic formulations. At the national

institutional level, there are research studies to discover tropical drugs for addressing the poor10

.

9 Elaborating on this is not in the purview of this study . We have various documents available with

International organizations like WHO, WIPO and WTO. 10 In an attempt to pull industry and academia together to explore the potential of herbal drug

development, CSIR, under the national network project known as New Millennium Indian Technology

Leadership Initiative (NMITLI), has instigated drug development projects on psoriasis, osteoarthritis, hepatitis and diabetes (Patwardhan 2009)

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Being told this, it is important to mention that, there are efforts to debilitate the potential of

indigenous systems at different points. The emergent international political economy and geopolitics actually reworked in the case of indigenous systems to sustain the exclusion it once confronted. It

seems that while the public has been eager and at times politically assertive in pushing for greater

acceptance of Ayurveda as a knowledge system, the mainstream scientific community have been

lukewarm due to the lack of systematic evidence.

While the lack of efficacy details remains partially a problem, another reason for the diminished

enthusiasm for Ayurveda from the scientific community may be fear of loss of medical dominance. While doctors have traditionally been the final arbiters of medicine and healthcare, the potential role

of Ayurveda to acquire more authority is a barrier to its acceptance. The regulation of indigenous

medicines has been piecemeal. Herbal medicines can currently be licensed through the conventional procedures for drug approval; the 2004, however, EU regulation on traditional herbal medicines

shows, to achieve a European traditional use licence, an applicant must demonstrate through

bibliographic or expert evidence of the medicinal use of the product in EU for 30 years. This is a

herculean task for any new entrants, though they have been practicing in the home country for hundreds of years.

In the context of World Bank-driven (or motivated) health reform (World Bank 1993), services such as those provided by traditional medicine lie clearly in the private sector. The new pressures

traditional medicines face will likely relate to the operation of the private market and this will have

impact on quality of services, and access to care, including medicines. With World Bank policy as the basic blueprint, governments will be motivated to exercise some measure of regulatory control and

indigenous medicines in many countries will likely find themselves transformed in the competitive

atmosphere of the private sector, where they must (and all else being equal) compete for patient fees,

sell medicines and support clinical facilities. This competitive process asks for a powerful incentive for professionalisation, i.e. for setting standards (to produce a standard product), licensing

practitioners, and controlling and/or disciplining colleagues and, in short, restricting competition in a

way (Starr 1982). Furthermore, there is also a tendency for the organisation of a medical system (regardless of epistemology or structural dominance) to order itself to the market in such a way as to

maximise use, rather than to maximize service. Practitioners, clinics and hospitals will be allocated

according to the distribution of economic resources, than according to the distribution of

epidemiologically defined need or demand (Janes 1999). This policy frame may not work well for alternate systems like Ayurveda, when they enter the market against already established systems.

Significant role of traditional medicine is first recognised by the WHO is at the landmark Alma Ata (Health for All by 2000) Declaration of 1978. Low cost and accessibility made them an ideal strategy for the public healthcare delivery programmes of developing-country governments. It was

assumed, however, that these systems would be integrated into the system such that they follow the norms and structures of the modern medical system. WHO left the detailed institutionalisation idea to

individual country governments, and kept its focus limited to guidelines for the manufacture,

assessment, clinical evaluation, appropriate use and quality control of herbal medicinal products and

medicinal plant materials (Banerjee 2004).

The radical changes in European and US markets and subsequent policy developments effected by the

EU, UK and US governments, transformed the status of traditional medicine worldwide. This made these governments set up task forces and advisory committees, instituted formal research laboratories,

and recognised herbalists and their associations as important stakeholders in the policy process,

thereby elevating these systems from the bottom run policy option of developing countries to those with great credence in the developed world. It was only by 2002 that the WHO found it important to

bring out a separate document on traditional medicine policy. This overall acceptance is relevant in

the context of increasing iatrogenic diseases worldwide11

.

11 The editor of the British Medical Journal (BMJ) noted in 1995 that only 15 per cent of biomedical interventions are supported by solid scientific evidence. In August 2004, the British Medical Journal published

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The integration of traditional medicine with national healthcare systems, as appropriate, by developing and implementing national policies and programmes, is one of the stated objectives in the WHO document (2002:5). In a footnote, the term appropriate is explained to refer to Traditional medicine healthcare that does not cost more and which is no less safe and efficacious than

recommended biomedical care for the disease or health problem (2002:43). There are two points here: that of cost and the other of safety and efficacy. In the political economy of overall developing

countries, one would be hard put to find the biomedical system offering cheaper means of healthcare,

except where the industry around indigenous medicine has to compete openly in the market with it, as is the case of Ayurveda. The WHO document, however, refers also to the large numbers of people in

developing countries who have access to the practice of TM that is not dependent on the market at all,

which would certainly be cheaper than biomedicines. Tying the strict safety and efficacy factors to alternative medicine targets and warns those bodies and products which enter national and

international markets for competition. It originally reiterates that those drugs will not be accepted until

the standards set by biomedical and pharmaceutical research have been met.

The history of research and the contestations of the terms of research in both India and China, to take

but two examples, is more than half a century old. In both countries, these contestations have been

recognised, but different resolutions have been arrived at by both the scientific community and the TM practitioners and researchers. What is interesting is that the Chinese pattern is recognised by

WHO to be a possible yardstick for its standards, along with the newly established research centres

and programmes of the US and UK. This, we argue, is related to the larger point on integration. Chinas model of integration of its TM into the public health system reflects an acceptance of the framework of research and the worldview of the treatment of biomedicine rather than battling the

differences. It makes a space for traditional medicine practice, but on the terms set by biomedicine,

where the TM has surrendered its perspective and philosophy of healing, while simply continuing the use of the remedies. This is most amenable to WHO capacity for actively taking traditional medicine

on board. It allows for the hegemony of continuing while making a respectable space for the

traditional. Insisting that the latter should be evidence-based, must be accessible and be governed by principles of rational use makes the space for the dominant establishments of science, industry and

regulators respectively, to continue to exercise their power (Banerjee 2004).

This is complemented with the development of what authority in Europe wishes to define as borderline products, those that the industry worldwide is happy to position as nutraceuticals and cosmeceuticals, simply names for dietary supplements and cosmetics. For some time now, herbal

products, even medicines, have been marketed in this category, because the legal structures of their definition allowed benefit to the Ayurveda companies. However, this is going to have a serious impact

on the export orientation of ayurvedic companies, inasmuch they would not be exporting medicines at all. For reasons different from the national level therefore, Ayurveda will be losing credibility in the international market as a medical system and will have to become a supplier of nutraceuticals and

cosmetics simply in order to remain viable (Banerjee 2004).

With regard to the public funding of these medicines, the picture is diverse: many are available Over the Counter and are so inexpensive that there is little public provision. In some countries like

Germany, these therapies are widely provided from public funds. In others, the lack of a strong

an analysis of the first results came from the National Patient Safety Agency. This agency draws together

reports of errors regarding the safety of patients and systems-failures that are provided by health professionals

across England and Wales. The report incredibly, found that, About 850,000 medical errors occur in NHS hospitals every year, resulting in 40,000 deaths. Yet, only 4000 misadventures are reported per annum, and only 2.2 per cent of all hospital episodes contain any mention of an adverse event. The conclusion is stark: the

medical profession is not being honest with itself or with the public and 516 extent of lethal error in its own practice (Aylin et. al 2004).

Page | 17

evidence base for their efficacy has discouraged their provision (Mossialos et al 2004)12

. Many of the

insurance providers in the West have not considered Complementary and Alternative Medicines as the potential source of inclusion into their purview. This is one of the major reasons for Ayurveda being

kept out of therapeutic choices by patients in many European countries.

In UK, it is clear that state power views herbal traditions as outside the system and have therefore created alternative frames for describing medicines as well established medicines, which in principle gives greater flexibility in the use of bibliographic data for this category of medicines to meet the

requirements to demonstrate safety and efficacy. The department of health of the British government has also an important role in these interventions. Its work was supported by the setting up of the Lord

Hunt commission on traditional medicines, which has set up dialogues with many members of the

herbal sector, including that of Ayurveda. It listed Ayurveda among those traditional medicines as unscientific13. In response, many groups of both scientists and industry have made representations to the committee, revealing the deep differences and fissures within them. But for the first time, this

issue is openly in the realm of international politics as it never has been before. In response to this

grouping the Government has recognised the point made that the Report had separated some practitioners of identical practices, such as Chinese herbal medicine and acupuncture, into separate

groups apparently as a result of effective lobbying by practitioners, or a rejection of underlying

medical models, rather than on the basis of the actual medical methods involved.

The Response shared by the government with the Report on CAM shows a basic attitude that

traditional medicine is something to be tolerated, controlled, regulated, and made safe not because of its potential health benefits, but solely because patients want it. Examples include the following

(Wujastyk 2004) statement,

We recommend that familiarisation should prepare medical students for dealing with patients who are either accessing or treating Complementary and Alternative Medicines (CAM) or have an interest

in doing so. This familiarisation should cover the potential uses of CAM, the procedures involved,

their potential benefits and their weaknesses and dangers (Response, p. 12)

However, in the matrix of power, with respect to the decision-making on agendas for research that

will influence policy, it is the various bodies in the governments of the US, UK and EU that continue

to play the most important role. These governments also control international trade regimes, the legitimising trends of consumer products, as also the markets for herbal medicinal products.

Therefore, the scientific and commercial parameters for the participation of the Indian herbal

medicine industry, or indeed that of other parts of the developing world will be firmly set by them. Even, most of the WHO works on CAM during the recent periods are ignored, when the regulative

structure is analysed and the status and policy frame is decided. This needs to be reconsidered in order

to nullify the negative effects found from the international pressure groups and lobbying. The mainstreaming efforts of ayurvedic and Chinese medicine are facing an extensive threat from the

lobbies. Even though, we feel that Ayurveda and other indigenous systems are been considered in the

global map of therapeutic ailments, what actually making this presence feel is the products that

dominates the herbal market. This illusive inclusion is no more different than the active exclusion in the initial period; unless it kick-start a detailed therapeutic enquiry.

3.2 National Context

12 Elias Mossialos, Monique Mrazek and Tom Walley (ed.) (2004)) Introduction, in Regulating pharmaceuticals

in Europe: Striving for Efficiency, Equity and Quality, Open University Press 13 Ayurveda here was listed in the third group. The third group was described as one which embraces those other disciplines which purport to offer diagnostic information as well as treatment and which, in general,

favour a philosophical approach and are indifferent to the scientific principles of conventional medicine, and

through which various and disparate frameworks of disease causation and its management are proposed (House of Lords select committee on Science and Technology, 2000).

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It may be important to note that all these systems of health which were indigenously developed in

India were predominantly practiced in the country even during the British Period. In the modern India also, the Congress Party at its Nagpur Session in 1920 was strongly in favour of choosing the best

from our indigenous systems as well as Modern Medical System to develop an integrated system of

health in the best interest of the ailing humanity. The Health Manpower & Implementation

Committee, popularly known as Bhore Committee (after the name of its Chairman, Dr. Bhore), which formed the basis of the present Health care system in the country, also suggested in 1946 that the

services of the persons trained in indigenous systems of medicine should be freely utilized in the

countrys health care infrastructure.

Though several committees constituted by Union government in Independent India, from time to time,

to look into different aspects of health care delivery system in the country, also suggested integration of all these systems and giving due importance to indigenously developed health systems, it was only

in 1978 that the first Community Health Workers Manual incorporated the use of Ayurveda, Unani, Sidha, Homoeopathy, Yoga, Naturopathy & medicinal plants to treat minor ailments. The first

National Health Policy of 1983 wanted to initiate organized measures to enable these systems to develop in accordance with their own genius with planned efforts to dovetail the functioning of the

practitioners. While the Bajaj Committee on National Education Policy for Health Sciences recommended a healthy & mutual respect for qualified practitioners of different systems of medicine for effective health manpower utilization, the Expert Committee on Public Health systems in 1996

wanted the practitioners of these systems to be appropriately involved in further strengthening the

public health system in the country (Mehrotra, 2011).

3.2.1 Current Scenario at national level

Though a separate Department of Indian Systems of Medicine & Homoeopathy was created in 1995

(Redesignated as AYUSH in 2003) to ensure the optimal development & propagation of the AYUSH Systems of Health Care, the budgetary allocations of the department have remained to be abysmally low and have never been more than 3% of the total health budget of the Union Ministry of Health & Family Welfare. It is ironical that its budget during the 11th Plan (Rs. 3988 Cr.) has been lesser than

the budget of NACO (5728 Cr.), which deals with threat of only one disease condition or even lesser

than that of a single Institution of Allopathy, namely AIIMS. The National Health Policy of ISM&H had recommended that the allocation to AYUSH be raised to 10% of the total health plan at the

central level and further growth to be designed to climb at the rate of 5% in every five year plan.

There has been slight increase in its allocations due to some funding from NRHM Flexi pool and a

few measures which have been introduced for Mainstreaming of AYUSH in the health care system.

The National Health policy of 2002 noted that the Alternative Systems of Medicine ..have a substantial untapped potential and wanted its use by encouraging evidence based research to determine their efficiency, safety ..to enable a wider popular acceptance of these systems of medicine. The National Policy & Programs of AYUSH in 2002 further strengthened the Department to promote good health & expand the outreach of health care to our people, besides integrating AYUSH in health care delivery system & National Programs and ensuring optimal use of the vast

infrastructure of its hospitals, dispensaries & physicians.

The National Policy on ISM&H, 2002, had emphasized the need for integration of ISM&H with the

Allopathic services as well as strengthening the ISM&H services in the public health service system.

It had spelt out strategies for:

Integration of ISM&H with the National Health Programmes and Primary Health Care delivery system.

Operational use of ISM&H in Reproductive & Child Health (in areas of ante natal, natal and post-natal care).

Revitalization of Local Health Traditions.

Making Available Home Remedy Kits (with herbal medicines).

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Inter-Sectoral Co-operation (School education, industry, culture, tourism).

Promotion of herbariums for local health care as well as sources of livelihood (being propagated by the AYUSH department, Bio-technology dept. and by NGOs).

Administration of the ISM Sector.

Exposing the Indian & Foreign Allopathic /Modern graduates to Indian systems of Medicine

Building awareness for AYUSH systems

Intellectual property rights and patents

3.2.2 National level efforts for the upgrading of Ayurveda

The Department of AYUSH was set to coordinate all efforts in this sector, though the support has

been only marginal. Since the First Five Year Plan, AYUSH has been getting only 2-4% of the National Health Budget. In the tenth plan, the cumulative expenditure of the Department of AYUSH

was approximately Rs.11000 Million. This is 2.75% of around Rs.40, 0000 Million that was spent for

the allopathic sector. The 97.5% of public fund expenditure on Health goes for Allopathy. This huge

gap and disparity is not only responsible for poor maintenance and development of ASU systems, rather is also the cause of overall frustration and apathy among ASU professionals. Even in the

eleventh plan, the outlay for AYUSH (around Rs.38000 Million) is still less than 3% of the health

budget for the allopathic sector (Rs 120,0000 Million). But the 12th plan commmitte has suggested

that the department should align its programmes and policies with the National Health outcome Goals

of reducing IMR, MMR, TFR, Malnutrition, Anemia, Population Control and Child Sex Ratio, etc.

The Department of AYUSH must also contribute to ongoing schemes of other departments such as

Janani Suraksha Yojana (JSY-AYUSH), ICDS-AYUSH, Reproductive Child Health (RCH), growth monitoring of children, ante and post natal care, etc. Interventions of AYUSH may either be in the

form of preventive, promotive or curative care. (Steering Committee Report on AYUSH for 12th Plan,

2011). However, towards enhancing competence of herbal resources, which are the main potential base of AYUSH, National Medicinal Plant Board has been set up with about 1% budget of AYUSH.

It is proposed to integrate about one million existing village-based healers in the form of either

traditional birth attendants or herbal healers who possess useful knowledge related to medicinal significance of biotic and plant genetic resources.

3.2.3 National Level Policy Support for Education and research

While there have been some increase in budgetary inputs, in the last decade in the area of AYUSH,

these have not been adequate. If we compare our efforts with China, it may be noted that China focussed on a few plants, besides ensuring that their efficacious products of public health interest are

standardised to the desired levels of quality and introduced at all levels of health care. On the other

hand, Indian R&D efforts have been scattered and lacked coordination among concerned departments of research, quality control & health care.

As recommended by the National Health Policy of ISM&H the allocation to AYUSH remains to be raised to 10% of the total health plan at the central level and further growth to be designed to climb at

the rate of 5% in every five year plan. Adequate support also remains to be provided by the states also

to implement the recommendations of the NRHM guidelines of 2006. Achieving international

standards requires considerable effort especially for small and medium enterprises and there is a need for providing funding, either grants or soft loans, to them to obtain the requisite counselling/training

services, bear the accreditation costs and most importantly undertake infrastructure development.

3.2.4 Assessment of national level efforts in R&D and innovation

Though Ayurveda has globally rekindled curiosity of man searching for an answer in Traditional Systems of Medicine due to emerging dissatisfaction with prevalent treatment modalities of Modern

Medicine, particularly for chronic or refractory diseases, due results have not been achieved due to

various reasons. While the concept of reverse pharmacology has been applied and the experts

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formulated time-bound goal-oriented projects on traditional remedies for Anal fistula, Diabetes

mellitus, Viral hepatitis, Bronchial asthma, Urolithiasis, Filariasis, Kala-azar and Wound healing, some encouraging results have also been obtained.

Kshaarasootra, a medicated thread used for Anal fistula has been found to be a safe, ambulatory and cost-effective alternative to surgery and has since been practiced in many places around the country.

Even the Russians showed keen interest in adopting this method. Similarly, a major breakthrough was

achieved with the hepatoprotective drug, Picrorrhiza kurroa at the CDRI, Lucknow which has also

been taken up for global marketing.

If we look at the Research Priorities of AYUSH as described in its website (Box 1, 2, 3 & 4), it is

obvious that issues of primary health care, including malaria, filariasis or public health concerns get lower priority as compared to areas like Diabetes mellitus including neuropathy, Peptic ulcer,

Psoriasis, Benign prostate enlargement Preventive cardiology-hypertension, obesity, Urolithiasis,

General Health Promotion Rasayana/Medhya Rasayana, Mental Health/memory relating disorders, Sports Medicine or Liver Disorders (Hepatitis B). While Secondary & tertiary health care relating

issues get lowest secondary priority, Identification and evaluation of promising and widely accepted

practices and skills of traditional healers in rural and tribal areas or Research on the preventive and

promotive aspects of AYUSH practices and therapies get very low priority.

There are no specific support programs to promote research on Type II or Type III diseases in

AYUSH. Nor have there been many serious studies to identify specific needs for research in relation to Type I diseases. As described above, the creation of a separate deptt. Of AYUSH has made some

difference but little efforts have been made to promote evidence based traditional medicine except

through some scattered projects supported by various Research Councils, Agencies as well as Planning Commission through a project of Golden Triangle.

Priorities in research have been more in the readily available strengths of AYUSH, which are to

handle Type I lifestyle diseases (Cancer, Obesity, Diabetes, CVD and hepatoprotectives, particularly Hepatitis B) or neurological disorders and brain stimulating and Strength giving /immunomodulators

drugs etc. Some work has been done on other diseases, which are refractory to allopathic drugs, viz.,

Psoriasis, Arthritis, and Bronchial Asthmaetc. However, the research priorities in AYUSH Research Councils have often been decided on readily available leads, rather than desired areas of public health

needs.

While a few products have emerged from Ayurvedic plants for CVS (Gugulip), Memory enhancer

(Bacopa monieri), contraceptives like Consap cream, Isaptent (cervical dilator) from CSIR lab, a

contraceptive and local anti bacterial-viral cream from NII have all been for Type I diseases. An anti-

asthma product has also been developed by IICB, Kolkata.

Early stage drug development has been made to develop modules of ethical conduct of research and

standards for various single ingredient as well as polyherbal formulations. Legislation on Good Manufacturing practices has also been introduced and being implemented to ensure the quality of the

products in the market, which is as yet being handled largely by small scale industry sector. While

some efforts have been made by ICMR to streamline clinical trials in the country and initiate the system of Institutional Ethics Committees at all levels, the clinical trials of AYUSH products are yet

to be really streamlined.

Some products under a coordinated program NMTLI have reached advanced stages of development, viz on Diabetes, Osteoarthritis, Hepatoprotective, Psoriasis (Type I), while some work on anti TB

(Type II) is also significant. The only disease on which some significant work is being done on Type

II disease is Malaria. The work has been done in some CCRAS Labs (Polyherbal-Ayush-64) and Arteether/artemether in CSIR Labs (CDRI, CIMAP, Lucknow & III,Jammu). Some basic work has

also been done on several medicinal plants products at IISc Bangalore and elsewhere, with ICMR support.

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Some work has also been done on Leishmaniasis (RRI, Puducherry), TD Medical College, Alapuzzha

and IICB, Kolkata. An important protocol has been developed for management of Lymphadenopathy due to Filariasis (or otherwise.)

Some work on anti diarrhoeals (FMR, Bombay), ICMR and amoebiasis (Bose Institute, Kolkata) in collaboration with DBT & ICMR. Some work has also been done on Leprosy (Karigari) and Kalajar

at PGI, Chandigarh with ICMR, besides HIV at Pune and Dengue at ICGEB, Delhi. Some work has

been done by CCRAS and CSIR-NMITLI on anti TB products also.

Some products have been introduced under RCH program for selected diseases under primary health

care needs as affordable products of sound therapeutic efficacy. However, quality standardisation of

many of these products is still under way.

Only a few, viz., HIV/AIDS, Malaria, filariasis, T.B., Leishmaniasis (Kalaazar), Psoriasis, Leprosy

and Dengue etc In AYUSH, four new important dimensions have been added during 11th Five Year Plan. These are (i) Role of AYUSH in public health (ii) Technology upgradation of AYUSH industry

(iii) international cooperation (iv) Revitalization of community based local health traditions the folk or Prakrit roots of AYUSH.

India has a vast treasure of both codified and un-codified traditional knowledge of medicine in

Sanskrit and other Indian languages. To pin down misappropriation of Indian traditional knowledge

and formulation at global level, an official database of such traditional information in the form of TKDL Traditional Knowledge Digital Library) has been institutionalised in collaboration of AYUSH

and CSIR at NISCAIR, New Delhi.

Box 1: First Level Research Priorities of AYUSH

Diabetes mellitus including neuropathy Peptic ulcer Psoriasis Malnutrition Reproductive Child Health (RCH) including infertility & contraceptives Benign prostate enlargement Preventive cardiology-hypertension, obesity Urolithiasis General Health Promotion Rasayana/Medhya Rasayana Mental Health/memory relating disorders Sports Medicine Liver Disorders (Hepatitis B) Primary health care relating issues Malaria Filaria Rheumatoid arthritis Menstrual disorder Reproductive tract infection.

Box 2: Second Level Research Priorities of AYUSH

Bronchial asthma Common ailments affecting children Improvement of quality of life in end of life conditions like cancer, HIV, AIDS Fever Upper respiratory tract infection Diarrhoea (including dystentery) Indigestion and anorexia Skin Diseases Cancer, HIV infection Secondary/tertiary health care relating issues

Box 3: Third Level Priorities of Research in AYUSH

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Research on fundamental principles of AYUSH Pancha Mahabhuts Tridosa Prakriti, Agni, Srotas, Saptadhalu, Ojas, Ama

Rasa, Guna, Virya, Vipaka and Prabhava

Similar areas of Siddha, Unani, Homoeopathy, Yoga & Naturopathy.

Identification and evaluation of promising and widely accepted practices and skills of traditional healers in rural and tribal areas

Research on the preventive and promotive aspects AYUSH practices and therapies

Revival of ancient literature-Survey, collection, transcription/translation, editing and publication of classical literature and text books E. Medico-historical investigations of AYUSH

Sample survey of contemporary requirements of AYUSH

Issues relating to the use of Modern Technology to develop the Drugs of AYUSH & Efficacy, Safety, Standards etc

Box 4: Research Projects funded by Indian Council of Medical Research during 2007-09 (270)

Medicinal Plants (16): Quality Standards-4+1; Diabetes-4; Carcinoma-2 (Others 1 each)

MCH- 4/15 (Home level delivery-3, Referral-1)

CVS-2/15 (Dietary Habits & Adivasis)

Pharma Physio- 2/5 (A-oxidant, Structure)

Nutrition-0/16 (Carbonated drinks)

Social Behaviour-0/15

Anti viral-0/27

Orthopaedics-0/5

Oral Health-0/2

Source: Mehrotra N N (2012), Needs and Gaps in Delivery and Access of Medicines of AYUSH

Health Systems: Analysis of its Public Health Potential, in Abrol, Dinesh (2012) GSPOA

Implementation: Status and Proposals, Report prepared by NISTADS for WHO India, NISTADS,

Delhi

Ayurveda was located successfully in the market by constructing it in a way that makes it accessible

to the consumers and secondly by constructing the drugs and cosmetic market so that it can position

the tradition in a way that it sells (Banerjee 2002). This has helped the sector to surpass easily the

basic issues of shuddh tradition, at least in manufacturing. This actually made the bifurcation or trifurcation of the Ayurvedic market into medicine, nutraceuticals and cosmetics necessary.

In the transnational context, Ayurvedas encounters with the West were not actually restricted to biomedicine alone, but mostly by global healthcare trends such as the interest in holistic medicine etc.

However, what we mentioned as circumvention strategy to deal with the problem of being less scientific is not long lasting. On the contrary, the situation demands proof for what so far claimed as cultural and original. This new trend of growing international demand works as both support and

hindrance for the circumvention strategy. While the increased trust and demand works positive for the market growth of a particular section, this in turn, puts pressure on the institutions to develop more

standardization and qualitative regulations in the practices of herbal systems. As of now, in many manufacturing firms the branded products including the beauty and cosmetic products constitute a

major share (as much as 90-100%) in the product lines. Bode showed that Himalayas entire production is branded products and Dabur has only 3% of classical products share (Bode 2008). As many countries do not entertain ayurvedic formularies in the medicine category, finding the way

through nutraceutical and cosmetic categories, can easily forgo the regulative regimes. This, in turn,

also helps them to be relatively less concerned in terms of efficacy of the product. Many companies product pattern over time shows that they have undergone a shift from Shastric medicines to cosmetic

category in due course of growth (Madhavan 2011). This does emphasise that, the turnaround in the

nature of products that ayurvedic companies offered have much to do with the policy frames within

which national governments supported ayurveda, the pressure and demand from external markets and also the regulative regimes that destination countries followed.

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Ayurvedic Industry in India includes both organized and unorganized sector now. Generally it is

shown that the market is concentrated (see table 5). In the organized sector, the major firms are Dabur, Himalaya, Zandu, Baidyanath, Aravaidya Sala Kottakkal etc. According to the Office of the

Drug Controller General of India, there are around 8,000 licensed pharmacies who manufacture herbal

drugs. The structural breakdown of the licensed pharmacies in terms of large and small companies is

unknown, making it difficult to access the level of concentration of the market. The herbal sector in India is, at the moment, quite fragmented and constituted for the majority by these small/ medium

enterprises.

Table 5: Distribution of 7000 Ayurvedic Manufacturers in India

Number of Licensed Ayurvedic Units Turnover

10 large units > 12.5 $US Million (Rs. 50 crores)

25 medium units Between 1.23 and 12.5 $US Million

965 small units Between 250000 and 1.25 $US Million

6000 very small units < 250000 US dollars (Rs. 1 crore)

Source: Ministry of Health and Family Welfare (2001)

In addition to these licensed pharmacies, there are a number of small-scale processing enterprises that

are unlicensed and operate in the informal sector. The unorganised sector includes practicing ayurvedic experts (vaidyas) and micro-units manufacturing only a few products and operating at the

local level. A reputed vaidya generally prepares hisown formulations for treatment. A large number of

ayurvedic medicine manufacturing units can be attributed to comparatively low infrastructure cost,

access to raw material, simple manufacturing process, and lack of standardization of quality and efficacy of medicines.

The world market of herbal products, including herbal medicines and raw materials is estimated to have an annual growth rate between 5 and 15 percent. Total global herbal health products market is

estimated to be 62 billion US $ and is expected to grow to 5 trillion US $ by the year 2050. Ayurveda

contributes Rs.3,5000 Million s (813 million US $) annually to the internal market. The Indian

medicinal plants-based industry is growing at the rate of 7-15 percent annually. The global trend of increased demand for medicinal plants for pharmaceuticals, phytochemicals, nutraceuticals, cosmetics

and other products is an opportunity for Indian trade and commerce (Pushpangadan and

Govindarajan, 2005). In India, there are about 8,000 firms manufacturing traditional medicines and a major amount of medicinal plants (90 per cent) used by these manufacturing units are collected from

the wild.

We argue that what indigenous medicine need to be worried about is not only its promotion in terms

of scientific validation, homogenization or targeted policies at various levels, but a deep rooted

political takeover at national and international context. Even if there is growing curiosity and

acceptance in the international platform, an underlying political economy is at work to nullify the efforts. The institutional response at least from the national level should not fall into the trap of

market regimes, where biomedical paradigms are dominant, unless it is pro-active and responsive to

the methodological concerns of indigenous systems.

4. IM in Kerala: Evolution, growth and present structure Kerala has been considered as the home of traditional ayurvedic system, with a rich bio-diversity and

natural ingredients based on plant species. The second largest number of manufacturing units is in

Kerala after UP (9-10 percent of total manufacturing units). In the late 19th century, the system

underwent multi-fold changes in the state, to suit the present global market. In the earlier days,

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production was con