India Engages with Domestic Pharma Exporters Amid US Tariff Concerns
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Synopsis
The Indian Commerce Ministry is actively engaging with pharmaceutical exporters over potential US tariffs. This follows President Trump's announcement of unprecedented tariffs that could impact the sector, which previously enjoyed exemptions.
Key Takeaways
- The Indian government is in discussions with pharma exporters due to potential US tariffs.
- Trump's possible tariffs may significantly affect Indian drugmakers' profits.
- The US is a vital market, with India supplying 40% of its generic drugs.
- Indian pharmaceutical exports to the US are valued at nearly $9 billion.
- Recent tariff talks have led to a drop in stocks of major Indian pharmaceutical companies.
New Delhi, April 4 (NationPress) The Commerce Ministry is currently engaged in discussions with Indian pharmaceutical exporters due to escalating worries regarding potential US tariffs on the industry, which had previously been excluded from the initial round of retaliatory tariffs by US President Donald Trump.
The negotiations commenced after Trump suggested imposing "unprecedented" tariffs on pharmaceutical imports (Thursday, US time).
Although minor tariffs might not lead to significant disruption, substantial duties could negatively impact the profit margins of Indian drug manufacturers.
The United States represents a crucial market for India’s pharmaceutical exports, with India accounting for approximately 40 percent of all generic medications utilized in the US.
Indian pharmaceutical exports to the US reach nearly $9 billion annually. A steep rise in tariffs could not only impact Indian exporters but also have a direct effect on American consumers, as reported by NDTV Profit on Friday.
Trump has initiated a new series of tariffs aimed at various sectors, including a 25 percent tariff on all imported vehicles and light-duty trucks, along with a 10 percent minimum tariff on other imported goods.
India faces a cumulative reciprocal tariff rate of 27 percent.
The government is reportedly monitoring the situation closely, collaborating with exporters to gauge the potential effects and investigate ways to mitigate risks, as mentioned in the report.
The latest comments from Trump have raised concerns among Indian pharmaceutical firms, many of which depend significantly on the US market for their operations. The shares of Indian pharmaceutical companies experienced a notable decline during the day.
Stocks of Aurobindo Pharma, Laurus Labs, IPCA Laboratories, and Lupin dropped by up to 8 percent on the National Stock Exchange (NSE) during intra-day trading.
In the previous trading session on April 3, shares of domestic pharmaceutical companies had gained some relief, despite other sectors facing heavy selling pressure, following the White House's exclusion of pharmaceutical products from the reciprocal tariffs.
