Clinical trials are integral to drug discovery and bringing out newer and better medicines. With the evolution of India’s disease burden as well as its pharmaceutical industry, the need for clinical trials has increased manifold. This report analyses prospects and challenges of clinical trials in India, focusing on New Chemical Entities and new drugs, and likewise proposes actionable policy recommendations for the Indian drug regulatory landscape so that the country can realise its untapped potential, while addressing concerns raised regarding the conduct and quality of clinical trials. The Government of India needs to develop a promotive ecosystem around clinical trials—now more than ever, sooner rather than later. A clear set of policy, rules and guidelines around clinical trials would be a central component in the larger strategy to address India’s public health challenges and incentivise the country’s pharmaceutical industry to mature to the next level.