The Centre plans to set up a new unit for manufacturing concentrated poppy straw (CPS) with an investment of Rs 165 crore. Accordingly, the Finance Ministry has invited bids for the production unit with a minimum capacity to process 10,000 tpa of poppy husk.

The facility will be set up near Neemuch in Madhya Pradesh on a public-private partnership (PPP) basis. The concession period would be for a 20-year period including three years of construction. This would be the second set-up to utilise the CPS method in the country, with a larger size and scale over the first one.

The private entity is expected to create a production block, adequate storage space for poppy husk and finished products and create facilities deploying the CPS technology to process the poppy husk and further extract semi-refined morphine, alkaloids or crude form of alkaloids. The extracted materials is mandated to meet the international quality norms, standards and certification in the US, Europe and Australia.

Further, the crude form of alkaloids and the final alkaloids will be processed by Government Opium and Alkaloid Factories (GOAM) for sale to domestic pharma companies. In 2022, the government had signed a five-year contract with Bajaj Healthcare, which has a factory at Savli in Vadodara, Gujarat.