With Donald Trump’s tit-for-tat tariffs оn India set tо take effect next month, millions оf Americans may face steeper medical bills. Indian Commerce Minister Piyush Goyal made a last-minute trip tо the US, hoping tо negotiate a deal tо protect India’s crucial export industries, especially medicinal drugs.
Nearly half оf all generic medicines consumed іn the US come from India, saving billions оf dollars annually. Without a trade deal, the tariffs could make Indian generics unviable, forcing companies out оf the market and worsening drug shortages.
The Critical Role of Indian Generics in US Healthcare
Indian pharmaceuticals fill nine out of ten prescriptions in the US, especially for conditions like hypertension and mental health. Drugs like sertraline, the most prescribed antidepressant, cost half as much as non-Indian alternatives.
Experts warn that tariffs could deepen demand-supply imbalances, with uninsured and low-income patients bearing the brunt. With raw materials for 87% of US drugs sourced internationally, mostly from China, existing price pressures could intensify.
Manufacturing Challenges and Tariff Fallout
Trump’s push to shift drug manufacturing to the US faces major hurdles. Indian firms operate on thin margins, selling low-cost drugs that would become unsustainable under US production costs. Building new facilities could take years and billions of dollars, making quick relocations unrealistic.
For Indian pharma, the US market is essential — contributing a third of revenues. A sudden tariff hike could cripple firms, disrupting supply chains and raising prices for American consumers.
The Political and Economic Calculations
India exports $12.7bn in drugs to the US annually, paying virtually no tax, while US drugs entering India face a 10.91% duty. Trump’s threat of reciprocal tariffs would widen this trade gap, hurting both sides.
Indian officials have hinted at reducing tariffs to de-escalate tensions, while industry leaders warn that even a short-term disruption could reshape the market for years. With elections looming, political calculations may influence whether the two nations can strike a last-minute agreement.
A High-Stakes Waiting Game
As both countries navigate complex trade negotiations, pharmaceutical companies, hospitals, and millions of patients are left in limbo. Experts suggest that while initial pain is likely, progress towards a deal is possible by the end of the year — but for many, that timeline may be too late.
The future of affordable medicine for millions rests on these high-stakes talks, with lives and livelihoods hanging in the balance as each side weighs the cost of compromise against the risk of prolonged conflict.
