Rogi Kalyan Samities (RKS) across the state are generating less than Rs 50 lakh annually from 42 medicine shops operating within government medical colleges and hospitals, raising questions over the efficiency of the current allotment model.
Information obtained through the RTI Act shows that the total rent collected stood at Rs 47.35 lakh in 2022-23, which further declined to Rs 37.29 lakh in 2023-24.
The figures appear particularly stark when compared to a single food canteen at the Atal Institute of Medical Super Specialties (AIMSS), Chamyana, near Shimla, which alone pays Rs 32 lakh per year in rent, nearly matching the combined earnings from all 42 medicine outlets.
These pharmacy shops are operated by the Civil Supplies Corporation under long-term memorandums of understanding (MoUs) with hospitals.
The AIMSS Chamyana Faculty Association (ACFA), in a memorandum submitted earlier to the Secretary (Finance), has flagged the significant revenue potential being lost due to the current system.
It has argued that if these shops were allotted through open and competitive bidding, the income accruing to the RKS could increase manifold.
At present, the rent structure is pegged at a nominal 0.2 per cent of annual turnover, while at IGMC, Shimla, it stands at 1 per cent.
To underline its argument, the association cited the example of PGI, Chandigarh, where nine medicine shops allotted through open bidding reportedly generate Rs 18.2 crore annually in rent.
Dr Yashwant Verma, Secretary of ACFA, who accessed the financial details through RTI, said the current arrangement benefits none of the stakeholders.
“Neither hospitals nor patients, nor even the Civil Supplies Corporation are optimally served under this model,” he said. According to him, the corporation earned profits of Rs 5.73 crore in 2022-23 and Rs 5.34 crore in 2023-24 from these shops, reflecting a net margin of just over 8 per cent of turnover.
“Given the margins typically associated with medicines and the negligible rent being paid, this is relatively low,” he added.
The association has also pointed out that despite paying minimal rent, these shops offer only a 10 per cent discount on medicines and 30 per cent on surgical items.
In contrast, pharmacy outlets at PGI-Chandigarh, despite paying significantly higher rents, offer at least 15 per cent discount on medicines along with similar concessions on surgical and generic items.
A senior official of the Civil Supplies Corporation acknowledged that the rent paid is nominal but said the corporation supports hospitals through credit facilities amounting to nearly Rs 30 crore.
“These outlets also operate round the clock, ensuring uninterrupted access to medicines for patients,” the official said.
However, ACFA has termed the existing outlets as under-performers and has sought cancellation of their licences. It has recommended that all such shops be re-allotted through open bidding to maximise RKS income.
With the state grappling with financial stress, the association argues that plugging such revenue leakages could yield far greater fiscal benefits than measures like salary deferments.
