Former US President Donald Trump has warned that Indian pharmaceutical exports may soon face high tariffs. Trump said that the tariff relief given to pharma products under the reciprocal tariff policy will soon be withdrawn.
What Did Trump Say?
Speaking at a dinner event hosted by the National Republican Congressional Committee in Washington, Trump said,
“We are going to announce a big tariff on pharmaceuticals very soon.”
Even though he didn’t mention India directly, this warning is important because India exports about 31.5% of its pharma products to the US.
What Is Reciprocal Tariff?
Under the reciprocal tariff policy, the US matches the import duties that other countries put on American products. This policy is now active from Wednesday.
Last week, the US had announced a 27% tariff on Indian goods under this policy. However, pharmaceuticals were given relief at that time.
Now, Trump is saying that this relief may soon be removed, which could affect Indian pharma exports to the US badly.
Why Is This a Big Issue?
- If the US imposes high tariffs on pharma products, it will increase the cost of Indian generic medicines in the US.
- Indian companies supply a large number of low-cost medicines, which help reduce healthcare costs in the US.
- Removing this relief can lead to higher prices for medicines in the US and losses for Indian pharma companies.
What Could Happen Next?
Trump also said that once tariffs are applied, pharma companies will stop depending on countries like China and start opening plants in different parts of the US.
This statement shows Trump’s plan to bring manufacturing back to America, especially in key sectors like pharma, semiconductors, energy, and minerals.
Trade War Situation Developing
India and the US are working on a trade agreement to reduce tariff tensions.
But with recent actions:
- China imposed a 34% tariff on US goods.
- In response, the US imposed 50% additional tariffs on Chinese imports, taking the total to 104% on some items.
All this has increased fears of a global trade war and possible economic slowdown.
If the US really imposes new tariffs on pharma, it could seriously hurt India’s pharma sector and affect global healthcare costs.
