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US Slashes Tariffs on Indian Medical Devices & Pharma in Historic Trade Deal

The United States has announced a major reduction in tariffs on Indian exports, lowering them from 50% to 18%. Industry experts hail this as a game-changer that will significantly enhance the global competitiveness of Indian medical device manufacturers. The deal provides Indian pharma companies, for whom the US accounts for 30-40% of revenue, with greater market access for generics and biosimilars. The move is seen as capitalizing on global supply chain diversification trends away from China, fostering investment and job creation in India.

Key Points: India-US Trade Deal Cuts Tariffs, Boosts MedTech & Pharma Exports

  • US cuts tariffs on Indian exports from 50% to 18%
  • Boosts competitiveness of Indian MedTech vs. China
  • US market key for Indian pharma, accounts for 30-40% revenue
  • Deal aims to spur investment, jobs, and 'Make in India' success
2 min read

India-US trade deal game-changer for MedTech, pharma sectors: Industry

US reduces tariffs on Indian exports from 50% to 18%, giving Indian MedTech and pharma sectors a competitive edge over China and unlocking new market potential.

"The US tariff slash... is a game-changer for Indian medical devices - Rajiv Nath, AiMeD"

New Delhi, Feb 3

The trade deal between India and the US is a game-changer for the Indian MedTech and pharma sectors, said industry experts on Tuesday.

In a historic move, the US has announced a reduction in tariffs on Indian exports to 18 per cent from 50 per cent, which is a constructive development for the India-US trade relations.

The US is India's largest export destination, accounting for about 20 per cent of total exports.

The Association of Indian Medical Devices (AiMeD), hailed the deal and noted that it can prove to be a "vital boost for our manufacturers, enhancing global competitiveness, spurring investments, and creating jobs".

"The US tariff slash from 50 per cent to 18 per cent is a game-changer for Indian medical devices, slashing export costs and unlocking billions in US market potential amid China+1 shifts. We urge sustained India-US regulatory harmonisation to capitalise fully on this opportunity for 'Make in India' MedTech success," said Rajiv Nath, Forum Coordinator, AiMeD.

Further, Nath noted that the US tariff cut to 18 per cent on Indian goods also provides Indian medical devices a competitive edge over Chinese counterparts, which face higher Section 301 tariffs typically at 25 per cent plus additional hikes (up to 50-60 per cent on some items like respirators).

"Previously, India endured up to 50 per cent duties while China had around 30 per cent, but the new deal aligns India's rate below China's base, favouring India amid China+1 diversification," he added.

The Pharmaceuticals Export Promotion Council of India (Pharmexcil) also highlighted the positive implications of the India-US trade deal for the Indian pharma sector.

"The India-US trade agreement represents a pivotal moment for the pharmaceutical sector, with key highlights including the reduction of tariffs on Indian goods exports," said Namit Joshi, Chairman - Pharmexcil.

"The reduction in reciprocal taxes is incrementally positive for Indian pharmaceutical companies, particularly those with significant exposure to the US market, which accounts for 30-40 per cent of the sector's total revenue," he added.

Joshi noted that the deal also fosters greater market access for Indian generics and biosimilars, strengthening India's position as the global leader in affordable medicines.

"By enhancing trade ties, streamlining regulatory processes, and ensuring supply chain resilience, this agreement will drive growth in India's pharmaceutical exports, unlock new opportunities for innovation, and reinforce the country's critical role in global healthcare," the expert said.

- IANS

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Reader Comments

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Priyanka N
As someone working in the pharma sector in Hyderabad, this is a huge relief. The US market is crucial for us. Reducing tariffs from 50% to 18% is a game-changer. It will directly improve our margins and allow for more R&D investment. Great move by the government!
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Aman W
Positive step, but the real test is implementation. We've seen deals before where benefits don't trickle down to smaller manufacturers. Hope the regulatory harmonisation happens quickly. Also, we must ensure quality isn't compromised in the race for exports.
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Sarah B
Interesting development from an international trade perspective. This strategic tariff adjustment clearly positions India as a preferred alternative to China for US healthcare imports. It strengthens the Indo-US partnership at a crucial time.
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Karthik V
Waah! This is what we needed. Our generics and biosimilars getting greater access means more affordable medicines for the world, and more business for India. Jai Hind! 🙏 Let's hope states like Gujarat, Maharashtra, and Telangana are ready to scale up production.
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Nisha Z
Good news, but I hope this doesn't lead to price increases in the domestic market as companies focus more on exports. Affordable healthcare within India is just as important. The government should monitor this.

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