Medical device makers red flag AP govt's 'delayed payments'; AP says false alarm

The Association of Indian Medical Device Industry (AIMED) and the fact check wing of the government of Andhra Pradesh have got into a war of words after the former cautioned its members to be careful about their supplies to the state government due to alleged instances of delayed payments. In a message “Caution, Red Notice”, AIMED had asked its members to ensure that future supplies to Andhra Pradesh Medical Services & Infrastructure Development Corporation (APMSIDC) was done on 100% advance payment terms, since payments to several of their members were on hold since four to five years now. AIMED says despite several reminders, six of its member firms are awaiting a payment of ₹39 crore from APMSIDC.

Taking objection to the message, the fact check wing of AP government tweeted from its official handle FactCheckAPGov, that in the last two years, the AP government has procured around ₹2,000 crore worth of equipment and has paid in time. “Only Rs.328 Crores payment is due from the last two months. Regarding the procurements and payments done in past years, it will be further investigated and action shall be taken”, the tweet said.

AIMED termed the government position questionable and put out a list of aggrieved suppliers who have been waiting for their bills to get settled. It also said that the government did not respond to letters and repeated requests for settlement. “Government of Andhra Pradesh believes in transparent business and has always worked towards achieving ease of doing business (EODB) practices,” the fact check wing said in a statement. “In the trying times of a pandemic, the government worked tirelessly to provide all the necessary equipment and medicines. The health infrastructure (physical and digital) both have been upgraded since 2019. The Red notice published by the informal group AIMED has certainly malicious intent behind it. The notice is under investigation and the government will take action against the involved persons/ associations/ groups in case any malicious intent is found behind this propaganda,” the statement added.

In a letter to D. Muralidhar Reddy, managing director, APMSIDC, on September 17, AIMED had informed that outstanding dues to their members were cleared within a timeline decided by APMSIDC, and AIMED will put a ‘caution check’ notice for its members on the association’s website asking them to carry out future sales strictly on the basis of advance payments.

APMSIDC is yet to respond to an email query sent by Fortune India on the complaint.