U.S. president Donald Trump imposes 100% tariffs on pharma; Indian exporters likely to be impacted
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In another big jolt to Indian exporters, U.S. president Donald Trump has announced fresh set of tariffs, including a 100% duty on branded and patented pharmaceutical imports, 50% on kitchen cabinets and bathroom vanities, 30% on upholstered furniture, and 25% on heavy trucks. Announced Friday morning (late Thursday in the U.S.), the Trump administration will bring these tariffs into effect from October 1, 2025.
Like always, the tariffs were announced in a post on his social media platform Truth Social. “Starting October 1, 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.” There will, therefore, be no tariff on these pharmaceutical products if construction has started,” Trump wrote.
Trump claims this move will encourage companies to set up manufacturing plants in the U.S., as under the new tariffs, companies that have their facilities already under construction will see exemptions.
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He has argued that the tariffs will boost domestic investment and reduce the budget deficit. These announcements came after the U.S. economic and employment data was released on Thursday, as the U.S. economy grew by 3.8% during the April-June period.
This decision could be a serious blow to India’s pharmaceutical sector, which had been hoping to remain largely unaffected by the previously introduced U.S. tariffs on various countries, including India.
For India’s pharma sector, the U.S. is the largest export market. India supplies over 45% of generics and 15% of biosimilars used in the American market.
As a result, shares of leading firms like Dr Reddy’s , Aurobindo , Zydus , Sun Pharma , and Gland Pharma are expected to be impacted on the exchanges today.
While the tariffs appear to target multinational firms’ branded and patented drugs, uncertainty remains over whether Indian complex generics and speciality medicines will also be hit.