NEW DELHI: The interim India-US trade arrangement provides certainty and clarity to the domestic pharma sector, with medicines staying outside reciprocal tariffs, and Washington signalling negotiated treatment for generics under Section 232.
India plays a critical role in supplying affordable medicines to the US, with shipments of around $10 billion accounting for nearly 35% of its overall pharma exports.
The Section 232 probe announced in April last year allows the US govt to investigate imports for potential national security threats, a process that could justify tariffs aimed at encouraging domestic drug production. The review covers global imports of finished formulations as well as active pharmaceutical ingredients.
While the sector remained insulated from punitive US tariffs, the agreement notes "contingent on findings of the US Section 232 investigation of pharmaceuticals, India will receive negotiated outcomes with respect to generic pharmaceuticals and ingredients".
Experts said India-US joint statement was reassuring. "Strengthening the partnership is important, as medicine security is a part of national security... overall pharmaceuticals, including generics, are subject to ongoing US Section 232 investigation, consistent with the approach across FTAs,'' Indian Pharmaceutical Alliance secretary general Sudarshan Jain said.
Manoj Mishra, partner and tax controversy management leader, Grant Thornton Bharat, said, "The US commitment to provide negotiated outcomes for generic medicines and ingredients, subject to the findings of the investigation, is significant."
The interim deal will potentially boost bilateral trade in medical devices. India's medical devices imports are valued at over $1.5 billion, while exports are around $800 million.
Rajiv Nath, forum coordinator for AiMeD, urged reciprocal fairness, making trade mutually advantageous to empower both nations' innovations.
A business journalist with around two decades of experience track...
Read MoreA business journalist with around two decades of experience tracking key consumer-focussed sectors like consumer durables, retail, consumer goods, aviation, automobiles and advertising, as well as economic ministries of the Union government. Now, writes primarily on pharmaceuticals and healthcare, and on issues of consumer interest. Besides also looks at trends that are shaping consumer behaviour and the broad consumer landscape. \nYou can follow Rupali on Twitter@Rupalijee.
Read Less
Start a Conversation
Post comment