Branded Drugs from India Hit by Trump’s 100% Import Duty from October 1

The United States, one of the largest markets for Indian pharmaceutical companies, will impose a 100 per cent tariff on branded or patented drugs starting 1 October 2025. US President Donald Trump confirmed the decision, presenting it as a step towards strengthening domestic pharmaceutical manufacturing and reducing dependence on foreign supply.

In a statement released on Truth Social, Trump made it clear that the tariff would apply unless companies are in the process of building pharmaceutical plants in America. The phrase "is building" was specifically defined to include projects that have either broken ground or are already under construction. His administration argues that this measure will encourage global pharmaceutical giants to bring production to American soil.

Indian pharmaceutical exports to the United States were valued at 3.6 billion dollars in 2024, rising to 3.7 billion dollars in just the first half of 2025. Major drugmakers such as Dr Reddy's, Sun Pharma, Lupin, and Aurobindo have benefited significantly from the US demand for affordable Indian generics. While the new tariff technically targets branded and patented medicines-an area dominated by multinational corporations-industry experts warn that complex generics and speciality medicines from India may also come under pressure.

The announcement was not limited to pharmaceuticals. Trump confirmed further import tariffs, including 50 per cent on kitchen cabinets, 30 per cent on upholstered furniture, and 25 per cent on heavy trucks. He stressed that these tariffs would give a competitive edge to domestic manufacturers such as Peterbilt, Kenworth, Freightliner, and Mack Trucks.

National security was highlighted as a justification for the 25 per cent tariff on heavy trucks. Earlier this year, the Trump administration launched an investigation into foreign truck imports to examine their potential impact on US security. This national interest argument has been extended to the wider tariff package.

For Indian exporters, the challenge is compounded by existing trade barriers. At present, they face a 50 per cent tariff which includes a 25 per cent penalty linked to ongoing purchases of Russian oil. The new tariffs will therefore add another layer of difficulty for businesses navigating the complex trade environment between India and the US.

Although the immediate focus of the tariff policy is on branded drugs, the uncertainty surrounding its scope has raised significant concern within India's pharmaceutical industry. The situation underscores how sensitive the sector is to global policy shifts and how critical it will be for Indian companies to adapt quickly. Diversification of markets and investment in advanced manufacturing could be key strategies for mitigating the risks of over-reliance on the American market.