Trump declares 100% tariff on pharma imports from October 1, setback for India 

WASHINGTON: US President Donald Trump has announced that a 100 percent tariff will be imposed on imported branded and patented drugs from October 1, 2025. Trump also clarified that companies that set up plants in the United States and manufacture medicines will be exempted from the tariff.

Trump's move is to attract more investments in the country through tariff policies. He claimed that importers cannot pass on the burden of additional taxes to consumers and that this will not lead to price increase.

Trump's new tariff will significantly affect Indian pharmaceutical companies. About 40 percent of India's pharma exports go to the US market. A report released by SBI Research earlier warned that if a 50 percent tariff is imposed, the revenue of Indian pharma companies is likely to decline by 5 to 10 percent in the fiscal year 2026.

Many large Indian pharma companies derive 40-50 percent of their revenue from the US market. The new tariffs will make Indian drugs less competitive and reduce profit margins as companies are unable to pass on the increased costs to consumers.

In addition to drugs, Trump announced import tariffs of 50 percent on kitchen cabinets and bathroom vanities, 30 percent on furniture, and 25 percent on heavy trucks, effective October 1. He wrote in Truth Social that the tariffs are for national security.

Despite Trump’s repeated claims that inflation is not a problem for the US economy, the Consumer Price Index has risen 2.9 percent over the past 12 months, the Associated Press reported. The US imported $233 billion in pharmaceutical products in 2024. The new tariffs will also cost homebuilders more, the report said.