It could be a real blow to Indian pharmaceutical companies if the US tariffs on pharma imports increase production costs and make their exports less competitive. PGE reports that experts are worried that increased tariffs may be bad for the Indian pharma sector which provides nearly 40% of medical prescriptions in the US. If tariff hikes are unsealed, India whose accounts for about one third of its total pharma exports, drug prices may rise and there will be a strained supply chain.
This view was also supported by legal expert Arvind Sharma who said that if the US imposes steep tariffs on Indian medicines then it will increase the healthcare cost in the domestic market and also compel Indian firms to diversify their exports to Europe, Latin America or Africa. Generic drugs made in India have helped the American healthcare system save $1.3 trillion over the last decade, and a sudden rise in tariffs may affect American consumers in the form of higher prices of essential medicines.
However, the Indian auto sector is expected to face almost no impact from these tariffs. The US is not a very big market for Indian automobile exports and, in return, duties on American vehicles are likely to affect the industry’s dynamics only to a small extent. While there could be some effect on automotive components, the expert thinks that India’s existing tariffs will not be drastically cut any time soon.
This is because the Trump administration’s push for reciprocal trade policies is changing the global trade dynamics and the potential impacts on Indian pharmaceutical exports are a big issue. Against the backdrop of the US tariffs, Indian firms may have to respond quickly to maintain their market position in the growing global market.
