India’s generic drug juggernaut was unstoppable amid US tariffs. Why a new trade deal may not change that

“There was barely any duty on generic drugs imported from India and it has remained so despite the reciprocal tariffs announced by the Trump government. When it comes to Section 232 investigations, it is akin to anti-dumping duties. This too is unlikely to affect duties on generic pharmaceuticals because the US does not have a lot of generic pharmaceutical manufacturing,” said an industry expert, who did not wish to be named.

They added: “And, if duty on pharmaceuticals imported from the US is completely done away with, it will actually be beneficial for the people. It will bring down costs of patented medicines. Again, it will not disrupt the Indian industry that is largely dependent on manufacturing generics.”

When it comes to medical devices, the joint statement said: “India agrees to address long-standing barriers to the trade in US medical devices.” The lowered tariff of 18 per cent is likely to aid India’s growing medical devices sector. “India’s medical device exports to the US have grown from $714.30 million in FY2024 to $782.57 million in FY2025, registering a healthy 9.55 per cent year-on-year growth, underscoring both scale and momentum. This agreement further provides a significantly larger opportunity for Indian medical device manufacturers to accelerate their growth in the US market,” said Himanshu Baid, Managing Director, Poly Medicure.

Non-tariff barriers such as approval processes in the United States have been a significant challenge for Indian manufacturers, with the new deal giving hope to manufacturers that these would be addressed. Rajiv Nath, forum coordinator of Association of Indian Medical Device Industry said: “CDSCO import licences for US devices are already faster than for Indian manufacturers, who face mandatory inspections unlike overseas firms… We urge reciprocal fairness, making trade mutually advantageous to empower both nations’ innovations.”

The United States accounted for 34.5 per cent of India’s total pharmaceutical export in FY2025, valued at $10.5 billion. To compare, the next biggest buyer was the United Kingdom that accounted for 3 per cent of the country’s total pharmaceutical export, valued at just $913.9 million, according to data from Pharmexcil. For the US, India continues to be important as it supplies 47 per cent of all generic medicines prescribed in the US.