US President Donald Trump has announced that, effective October 1, a 100% tariff will be imposed on pharmaceutical products imported into the US from companies without domestic manufacturing facilities. This decision poses a serious challenge for India, whose pharmaceutical industry heavily relies on the US as its largest export market.
India supplies approximately 45% of generic drugs and 15% of biosimilars used in the US. In FY-24, India exported $8.7 billion worth of pharmaceutical products to the US, out of a total $27.9 billion in global pharma exports. For many Indian pharma companies, the US accounts for 30-50% of their revenue, making them highly vulnerable to this new policy.
The tariff could lead to increased costs, reduced competitiveness, and disrupted supply chains, forcing Indian companies to reconsider strategies, including setting up manufacturing units in the US or exploring alternative markets. Industry analysts view this as a major turning point in India-US pharma trade relations.
