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Trump’s 25 pc tariff hike may hit Indian drug makers

The list of medicines imported into the US includes some of the critical life-saving drugs which could severely put an additional burden on the pockets of US consumers.

News Arena Network - Washington D.C. - UPDATED: February 21, 2025, 12:12 PM - 2 min read

United States President Donald Trump. Image: X


President Donald Trump’s proposed 25 per cent tariff hike on pharmaceuticals imported into the United States could have a sizeable impact on Indian companies, leading to supply chain disruption and increased costs for American consumers, reports said.

 

The list of medicines imported into the US includes some of the critical life-saving drugs which could severely put an additional burden on the pockets of US consumers.

 

During his press briefing earlier this week at his Mar-a-Lago residence, Trump informed reporters that the tariffs on pharmaceuticals and semiconductor chips would begin at “25 per cent or higher.”

 

However, he said companies having manufacturing units placed in the US will be kept out of the tariffs.

 

“We want to give them time to come in because, as you know, when they come into the United States and they have their plant or factory here, there is no tariff. So we want to give them a little bit of a chance,” he said.

 

India exported some $ 8.73 billion in fiscal 2024 – a nearly 16 per cent increase from the previous year – accounting for about 31 per cent of the industry’s overall exports, according to the government-backed trade body Pharmaceuticals Export Promotion Council of India (Pharmexcil).

 

The tariff hike announcement has come as somewhat surprising for the Indian Pharma industry after Prime Minister Modi and Donald Trump recently negotiated several trade agreements, including strengthening the bilateral relations between the two nations.

 

The two leaders promised to “elevate” bilateral trade to $500 billion by 2030, more than double the current volume.

 

Both New Delhi and Washington have also agreed to finalise the first phase of the bilateral trade agreement (BTA) to address the existing barriers by 2025.

 

Also read: Trump confirms Kash Patel as FBI Director

 

Experts argue that “India’s tariffs on US pharmaceuticals could be a hindrance and removing them might prevent the US from imposing retaliatory tariffs on the Indian Pharma sector.”

 

Meanwhile, Sun Pharma MD is of the view that these tariffs would hurt US consumers more.

 

Sudarshan Jain, secretary general of the Indian Pharmaceutical Alliance (IPA), said imposing tariffs on Indian medicines is an unwise decision, as India supplies nearly 47 per cent of generic medicines for American patients and contributes significantly to the country’s healthcare savings.

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