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BUSINESS & TRADE AUGUST 08, 2025 | The Indian Eye 40

Pills, Power, and Pushback:

How India’s Pharma Giants Plan to

Outsmart Trump’s Tariffs

As the U.S. slaps steep tariffs on Indian goods, the pharmaceutical industry — backbone of

American generics — is fighting back with strategy, scale, and sharp warnings

OUR BUREAU
Mumbai
ndia’s pharmaceutical industry — the world’s
pharmacy and a critical pillar of U.S. health-
Icare — is bracing for turbulence. With Presi-
dent Donald Trump’s latest executive order impos-
ing a flat 25 per cent tariff on all goods from India,
including potentially pharmaceuticals, the message
from New Delhi’s pharma corridors is clear: we’re
ready, we’re resilient, and America may feel the
pain more than we do.
Indian manufacturers currently supply near-
ly 47 per cent of generic drugs in the U.S., from
life-saving cancer treatments and antibiotics to
essential chronic disease medication. That supply
chain, built over decades, has been a pillar of af-
fordability in the American healthcare system. But
with Trump’s tariffs threatening to disrupt this del-
icate balance, Indian pharma leaders are preparing
a two-pronged counteroffensive.
Girdhar Gyani, Director General of the As- India’s pharmaceutical exports to the U.S. were valued at $8.5 billion in 2024, with the figure projected to grow steadily as
sociation of Healthcare Providers (India), called
the decision “short-sighted” and warned of imme- aging populations drive up demand for affordable generics
diate consequences for American consumers. “If
enforced, these tariffs could increase U.S. drug their market.” ambiguity itself is causing market jitters.
prices by 20 to 25 per cent annually — a burden Kumar also noted that Indian exporters are ex- Still, Indian industry leaders aren’t waiting
of nearly USD 6 to 7 billion. It’s unclear if the U.S. ploring alternative markets, including Europe, Af- around for clarity. They’re building resilience —
healthcare system can absorb that kind of shock,” rica, and Latin America, to cushion any potential not just in supply chains, but in diplomacy. Gyani
Gyani said. hit. “We’ve survived tougher times. We’ll bounce believes ongoing dialogue between New Delhi and
Rather than panic, Indian firms are already back,” he said. Washington could lead to a “reconsideration” or
adapting. One key strategy involves ramping up At the core of this controversy is India’s unique targeted exemptions, especially once the impact on
production in U.S.- and Mexico-based plants position in the global pharmaceutical supply American drug prices becomes undeniable.
owned by Indian pharma giants — a move that chain. According to Pharmexcil Chairman Namit The stakes are high. India’s pharmaceutical ex-
would sidestep the tariffs entirely while maintain- Joshi, Indian firms are irreplaceable in providing ports to the U.S. were valued at $8.5 billion in 2024,
ing supply lines. Indian firms like Sun Pharma, Dr. high-quality, affordable medicines globally. “Our with the figure projected to grow steadily as aging
Reddy’s, and Lupin have long invested in overseas drugs keep prices low in the U.S. — especially in populations drive up demand for affordable gener-
facilities, giving them flexibility others lack. critical areas like oncology, cardiology, and infec- ics. Disrupting this flow could cause economic and
The second strategy is about evolution, not tious diseases. Any disruption could cause shortag- political headaches on both sides of the Atlantic.
evasion. Gyani explained, “We’re shifting focus es and cost spikes,” Joshi warned. For now, Indian pharma’s message is one of
from basic generics to value-added combination And the problem isn’t short-term. While calm strength. Far from being a casualty, it is posi-
drugs — single pills combining multiple medica- Trump’s policy might aim to encourage domestic tioning itself as a case study in global adaptability.
tions.” These combination therapies offer more manufacturing, building local pharma capacity in With diversified manufacturing, upgraded product
convenience to patients and command higher pric- the U.S. will take years. “Establishing meaningful portfolios, and longstanding trust in global mar-
es, allowing Indian firms to maintain margins even API production and manufacturing facilities will kets, the industry is showing how soft power, sci-
under a tariff regime. take at least 3–5 years,” Joshi said. In the meantime, ence, and supply chain smarts can counter even the
The industry’s confidence is echoed by Dil- U.S. patients and hospitals could bear the brunt. most aggressive trade policy.
ip Kumar, Chairman of Medical Tourism at the There’s also confusion in the air. In an earli- As the battle over tariffs heats up, one thing is
Chamber of Commerce. “Trump is trying to kill er April announcement, the Trump administration clear: Indian pharma is not backing down. Instead,
the Indian market, but it won’t work. The U.S. is had exempted pharmaceuticals from tariff cover- it’s gearing up — not just to survive Trump’s tariff
dependent on Indian and Chinese pharmaceutical age. Whether this fresh 25 per cent blanket tariff storm, but to emerge stronger, smarter, and more
exports. Their system needs us more than we need now includes drugs remains unclear — and that indispensable than ever before.

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