The Donald Trump administration has reportedly decided not to impose tariffs on imports of generic drugs from foreign countries, offering relief to India and other nations that export these medicines to the US, according to a US media report.
The decision follows months of deliberation over whether to target generic medications, which account for the majority of prescriptions in the United States. The move comes under Section 232 of the Trade Expansion Act of 1962, which allows the US government to evaluate tariffs on products deemed a national security threat, including pharmaceuticals and their ingredients, The Wall Street Journal reported.
Last month, President Trump announced a 100 per cent tariff on branded and patented drugs, effective October 1. Generic drugs were not included in the measure. Officials cited that postponing tariffs on generic medications would provide more time to negotiate with pharmaceutical companies.
Analysts noted that the tariff on branded drugs would largely affect multinational pharmaceutical giants such as Pfizer and Novo Nordisk, with minimal impact on Indian drug makers. India exports primarily generic, off-patent medicines to the US, which make up roughly 20 per cent of Indian pharmaceutical exports.
“The imposition of a 100 per cent tariff on branded and patented pharmaceutical products may not significantly affect Indian drug manufacturers,” said Anuj Sethi, Senior Director at Crisil Ratings.
India supplies about 40 per cent of generic medications in the US, helping keep medicine costs affordable for American consumers. These generics provide lower-cost alternatives for the treatment of conditions ranging from diabetes to cancer. Indian exporters ship approximately $20 billion worth of generic drugs annually to the US, with leading companies including Sun Pharma, Dr. Reddy’s Laboratories, Cipla, Lupin, and Aurobindo Pharma.
Generic drugs form a substantial portion of India’s pharmaceutical exports, with around one-third destined for the US market. Industry experts say that excluding generic medicines from the tariff plan safeguards the supply chain of essential medicines, protects consumer affordability in the US, and maintains India’s export revenues.
The US government’s approach reflects an effort to balance national security considerations with maintaining access to affordable medications for American patients. The decision is also expected to stabilize ongoing trade relations between India and the US in the pharmaceutical sector, where both countries have longstanding economic and strategic ties.
By excluding generics from the tariff plan, the Trump administration has removed a major uncertainty for Indian pharmaceutical companies while allowing further negotiations with multinational corporations on future drug trade policies.
This development underscores India’s critical role in global generic drug supply and highlights the strategic importance of maintaining uninterrupted access to affordable medicines in the US market.
