The health ministry will put on hold its plans to grant permissions to multinational pharma firms for conducting phase I clinical trials of molecules developed outside India until it finalises guidelines for effective monitoring and supervision in the country.

"Until the guidelines for conducting phase I clinical trials in the country are ready, we will not grant permission to any multinational company to conduct these trials in the country," Health Minister Anbumani Ramadoss said while interacting with representatives of pharmaceutical industry. 

The government is currently working on formulating the guidelines for supervising conducting clinical trials in the country and soon it would come up with the details in this regard, the minister said.

Phase I clinical trials are the first stage of test of safety and efficacy of new drugs on humans after passing trials on animals.

"We are also working on preparing a separate section for clinical trials and medical devices in the proposed Central Drug Authority Bill," Ramadoss added.

Earlier, Drug Controller General of India has given indications that it may grant permission to multinational pharmaceuticals to conduct phase I clinical trials in India.

The decision was expected to open up new vistas and challenges for the Indian clinical trial industry which is expected to become a two billion-dollar industry by 2010.

Civil rights group and NGOs working in the health sector had opposed it saying the government's move will make Indians guinea pigs for the benefit of the big MNCs.