Daijiworld Media Network - Washington

Washington, Oct 9: The Donald Trump administration has decided not to impose tariffs on generic drug imports, providing a significant reprieve for India and other major suppliers of affordable medications to the US, according to a report.

The decision follows months of speculation over whether the administration would expand its trade crackdown to include the generic pharmaceuticals sector under Section 232 of the Trade Expansion Act of 1962, which allows tariffs on imports deemed threats to national security.

While President Trump had earlier announced a 100 per cent tariff on imported branded drugs effective October 1, generic drugs were notably excluded from the move. Officials cited the need for more time to negotiate with pharmaceutical companies as the reason for delaying any action on generics.

Analysts had previously noted that the steep tariffs on branded and patented medicines would largely impact multinational pharma giants such as Pfizer and Novo Nordisk, rather than Indian drug manufacturers. India, which supplies around 40 per cent of all generic drugs used in the US, is a critical player in ensuring affordable healthcare for American consumers.

Indian pharmaceutical exports to the US — valued at approximately $20 billion annually — consist mainly of generic, off-patent medicines used to treat a wide range of conditions including diabetes, hypertension, and cancer. Major Indian pharma exporters like Sun Pharma, Dr. Reddy’s Laboratories, Cipla, Lupin, and Aurobindo Pharma are thus expected to remain unaffected by the current tariff structure.

Anuj Sethi, senior director at Crisil Ratings, observed that the 100 per cent tariff on branded products is unlikely to hurt Indian pharma companies significantly, as their export focus remains firmly on the generics segment.

Roughly one-third of India's total pharmaceutical exports go to the US, making it a vital market. By excluding generics from its tariff measures, the Trump administration has temporarily avoided disruption to the US supply chain of essential medicines and cushioned both consumers and key trade partners like India from potential price shocks.