Key Points

In a weekly briefing, MEA Spokesperson Randhir Jaiswal stated that relevant ministries and departments are monitoring the situation and examining its potential effects.

"We saw a notice yesterday on social media that talked about new tariffs. We've seen the report on pharma and other products, and the relevant ministry and department are closely monitoring the matter and examining its impact," Jaiswal said.

The tariffs specifically target branded and patented pharmaceuticals, potentially affecting multinational pharmaceutical companies. The US is India's largest pharmaceutical export market, accounting for around 35% of total exports, valued at approximately $10 billion in FY25.

The comment came against the backdrop of Trump's announcement earlier on Friday, in which the US President said his administration would impose a 100 per cent tariff on branded and patented pharmaceutical products beginning October 1, 2025, unless the manufacturing companies are building production facilities in the United States.

Trump detailed the decision in a post on Truth Social, where he wrote, "Starting October 1st, 2025, we will be imposing a 100% Tariff on any branded or patented Pharmaceutical Product, unless a Company IS BUILDING their Pharmaceutical Manufacturing Plant in America. 'IS BUILDING' will be defined as 'breaking ground' and/or 'under construction.'"

Providing clarification on the exemptions, Trump added that companies which had already begun construction of plants in the US would not be subject to the new tariff. "There will, therefore, be no Tariff on these Pharmaceutical Products if construction has started. Thank you for your attention to this matter!" the post read.

The announcement on pharmaceutical tariffs was part of a broader set of trade measures unveiled by the US President. He also announced sweeping tariffs on various household products, including imported kitchen cabinets and certain kinds of furniture--categories that have already seen prices surge in recent months. In addition, Trump announced heavy tariffs on trucks and pharmaceutical products, CNN reported.

The 100 per cent tariffs are only applicable to patented or branded products, and will not impact generic medicines. Experts have suggested that India's exports to the US primarily consist of generic drugs and active pharmaceutical ingredients (APIs), which are not covered under this tariff.

Sudarshan Jain, General Secretary of the Indian Pharmaceutical Alliance (IPA), said, "This [100 per cent tariff on imported pharmaceutical drugs] applies to patented branded products manufactured outside the US. It does not apply to generics, as India supplies the US mostly with generic products. India exports around USD 10 billion worth of medicine to the US. They consist primarily of generic products and APIs. So India is not likely to be impacted by this order."

The Indian pharmaceutical sector supplies over 50 per cent of global demand for various vaccines, 40 per cent of generic demand in the US and 25 per cent of all medicines in the UK. India's annual drug and pharmaceutical exports touched a record USD 30 billion in FY25, bolstered by a 31 per cent year-on-year surge in March.

According to a government release, drug and pharmaceutical exports increased by 6.94 per cent from USD 2.35 billion in August 2024 to USD 2.51 billion in August 2025 alone.

- ANI