Chennai: Pharma is among the very few sectors which are exempted from US President Donald Trump’s reciprocal tariff rage. For the time being, pharma companies can heave a sigh of relief.
“Some goods will not be subject to the reciprocal tariff… These include copper, pharmaceuticals, semiconductors, and lumber articles… bullion and energy and other certain minerals that are not available in the United States,” the White House said in a statement.
Among them, pharmaceuticals is the major category that exports products worth $8.2 billion to the US. This is 30 per cent of India’s overall pharma exports valued at $27 billion.
“As of now, the announcement is a big relief for the pharma sector. But, taking the inconsistencies into consideration, we do not know whether there will be a policy change later. It is good that the administration recognises the importance of cost-effective Indian generic formulations and how much the US is dependent on them. If tariffs are levied on pharma, US consumers will be badly affected as prices of drugs will go up. Pharma being an essential commodity, it will have a severe impact on people’s lives,” said Ravi Uday Bhaskar, former director general of the Pharmaceuticals Export Promotion Council of India (Pharmexcil).
The basic tariff of 10 per cent for all goods imported into the US will be levied on pharma products as well. US president Donald Trump in his speech in February had mentioned that he would impose reciprocal tariffs on pharmaceuticals, along with automobiles and computer chips. Hence, the industry is still sitting with fingers crossed.
“We wait for more details and note that higher tariffs are not completely ruled out for the future of pharmaceuticals. A 10 per cent basic tariff on pharma products is expected to have negligible impact,” he said.
