The Indian Pharmaceutical Alliance (IPA) has welcomed the exclusion of pharmaceuticals from the new US import tariffs, calling it a major boost to India-US trade relations. IPA Secretary General Sudarshan Jain highlighted that this exemption reinforces the Mission 500 initiative, which aims to double bilateral trade to USD 500 billion.
“India and the US share a strong and growing bilateral trade relationship, with a shared vision to expand trade under Mission 500. Pharmaceuticals are a cornerstone of this partnership, ensuring a steady supply of affordable medicines to the US and the world,” said Jain.
He further stated that the tariff exemption acknowledges the critical role of India’s pharmaceutical industry in global public health, economic stability, and national security.
On Wednesday, US President Donald Trump unveiled new import tariffs, with India facing a 26% tariff on most goods. However, pharmaceuticals, semiconductors, copper, and energy products have been exempted.
During the Make America Wealthy Again event, Trump addressed trade imbalances, stating: “India charges us 52 percent, and we charge them almost nothing. Prime Minister Modi is a great friend, but they need to treat us fairly.”
Trump also highlighted tariff discrepancies in automobiles, stating that the US imposes only a 2.4% tariff on motorcycles, while:
- India charges 70%
- Vietnam charges 75%
- Thailand charges 60%
A Jefferies report suggests that agriculture, automobiles, and pharmaceuticals could be key sectors in a potential India-US trade agreement, as these industries hold economic and political significance for India.
Meanwhile, the US tariff rates on other major countries are:
- China: 34%
- European Union: 20%
- Vietnam: 46%
- Taiwan: 32%
- Japan: 24%
- India: 26%
- United Kingdom: 10%
- Bangladesh: 37%
- Pakistan: 29%
- Sri Lanka: 44%
- Israel: 17%
With pharmaceuticals playing a pivotal role in trade relations, experts believe this tariff exemption could strengthen supply chain resilience and drive further economic collaboration between India and the US.