Global pharmaceutical conglomerates’ recent acquisitions of Indian companies have alarmed health officials and patient advocacy groups who say that cheap generic drugs may no longer be available for millions of poor people in the coming years.

Now, the government is considering erecting barriers to foreign investment in India’s booming pharmaceutical industry to prevent takeovers. Officials say they could introduce new caps on foreign investment and tighten the rules of entry into the industry.

“The recent acquisitions of Indian companies by multinationals are a cause of major concern for us. This will affect availability and affordability of generic drugs for India’s poor,” said L.C. Goyal, additional secretary in the Ministry of Health and Family Welfare. “Right now, our policy says anybody can walk in and acquire. We have to ensure that these acquisitions do not undermine our public health priorities.”

Since 2008, global pharmaceutical giants have acquired six Indian drug companies. The Japanese company Daiichi Sankyo took over India’s largest drug producer, Ranbaxy, for $4.6 billion, and U.S.-based Abbott Laboratories acquired the domestic business of Indian firm Piramal Health Care for $3.7 billion last year.

A health panel of lawmakers has called for new policies to ensure that major Indian drug companies remain in domestic hands.

Last month, Commerce Minister Anand Sharma said that foreign investment in existing Indian drug companies will no longer be “automatic,” and that future investors will have to apply to the Foreign Investment Promotion Board for approval.

India’s $11 billion drug industry is likely to grow to $30 billion by 2020, a jump of 163 percent, analysts say. Indian firms produce 20 percent of global generic drugs, and account for almost 30 percent of the U.S. generic market.

Analysts say that the recent mergers and acquisitions of Indian companies are aimed at the $150 billion in business opportunities that will open up by 2014, when several drug patents expire. With research funds drying up, the economic slump and drug patents expiring, big companies are turning to the generic drug market.

“This kind of an opportunity for growth does not come very often. Indian drug companies are perfectly placed to tap this with our generic manufacturing expertise. This is why so many global companies are acquiring Indian firms,” said Dilip G. Shah, chief executive officer of Vision Consulting Group, which advises pharmaceutical companies.

The U.S. Food and Drug Administration has approved 119 Indian manufacturing sites, the highest number of any foreign country. Almost all of Wal-Mart’s U.S. pharmacies source their medicines from India, Shah says.

Health officials say that the global takeovers will turn India into a low-cost manufacturing hub for richer nations, and weaken their domestic focus.

“The Indian industry was built to make cheap lifesaving medicines available for its poor. But the foreign takeovers may shift their focus toward exporting to developed nations,” said Goyal.

Nearly two-thirds of Indians do not have access to essential medicines. On average, the cost of Indians’ drug consumption is among the world’s lowest, at less than $5 per year compared to $53 for Chinese and $680 for Americans. “We have a long way to go to meet their needs. But there is already a significant surge in exports in recent years,” he said.

But Tapan Ray, director general of the Organization of Pharmaceutical Producers of India, says the government’s apprehensions are baseless because foreign companies make up only 19 percent of the total share of India’s pharmaceutical industry. He said that Indian companies have gained access to expertise and resources through the mergers.

“The limiting of foreign direct investment at this stage . . . will indeed be a retrograde step for the country,” said Ray.

Many global drug companies left India in 1970 because of a restrictive patent law that allowed Indian companies to tweak the manufacturing process of globally patented drugs and produce cheaper drugs locally. But this also gave local companies expertise in formulations of drugs and turned India into a robust producer. Over the years, developing countries bought affordable drugs from India, including those used to treat HIV/AIDS.

India manufactures more than 84 percent of the HIV drugs used by the humanitarian organization Medecins Sans Frontieres (Doctors Without Borders) and more than 50 percent of medicines distributed by UNICEF.

But since liberalizing its economy in 1991, India passed a patent law after signing the World Trade Organization (WTO) accord in 1995, lifted the cap on foreign investment, and reduced from 354 to 74 the number of drugs under government price control.

Although the new patent law of 2005 complies with WTO rules on intellectual property, India put in some safeguards for its patents. It does not allow new patents for minor improvements of existing medicines called “incremental innovations.” The government says this “incremental innovation” helps global companies extend the patent period of a drug and will delay the rollout of new generics.