MUMBAI, Nov. 29 -- Once focused on low-margin active pharmaceutical ingredients (APIs), India's bulk drug manufacturers are stepping up their ambitions. Several are now pouring capital into research and development (R&D) to court global drugmakers for contract development and manufacturing work.

The shift reflects both ambition and timing. While APIs remain a mainstay, firms are now building capabilities in niche molecules, drug discovery, development and scaled manufacturing, as global companies look to derisk supply chains away from China. According to a JM Financial analysis, China accounts for about 13% of the global CRDMO market.

Some have already won early business with global innovators, but analysts say most still lack the scale...