The US tariff war gives the Indian pharmaceutical industry a little break

As US President Donald Trump announces new tariffs, India’s pharmaceutical industry is safe—for now—showing how important it is to American healthcare.

New Delhi, India – August 7, 2025:   The growing trade war between the US and India has spared one important sector, giving people a brief sense of relief as tensions rise.  The Indian pharmaceutical sector has been “excluded” from immediate punishment, even though the US has put a fresh 25% tariff on Indian exports.  This exception recognizes how important generic drugs are for making healthcare cheap for Americans.

Sudarshan Jain, Secretary General of the Indian Pharmaceutical Alliance, verified the story by saying, “The US Administration’s recent Executive Order does not allow tariffs to be put on the pharmaceutical sector right away.”

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Jain says that this choice isn’t only a nice thing to do; it’s also a smart move.  Generic drugs from India are a key part of making healthcare in the US affordable, and the companies that make them usually work on “razor-thin margins.”  If this supply chain were to be interrupted, it may have a big effect on patient care and the availability of drugs.  Jain went on to say that the relationship between India and the US is important for “securing API supply chains and making healthcare more resilient.”

A 50% Tariff on the Broader Trade War

This modest break for the pharmaceutical industry comes at a time when there is a far bigger and more significant trade war going on.  Donald Trump, the President of the United States, signed an Executive Order that put an extra 25% tariff on imports from India. This brought the total duty to a whopping 50%.  The decision says that India’s purchases of Russian oil pose an “unusual and extraordinary threat” to the US because of national security and foreign policy issues.

The first charge went into force on August 7. After 21 days, an extra 25% would be added to all Indian goods, save for those that are already on their way or meet certain criteria.

India’s answer: “Unfair and Unjustified”

The Ministry of External Affairs (MEA) in India didn’t hold back when it came to the new tariffs.  The MEA said in a heated official statement that the US’s measure was “unfair, unjustified, and unreasonable.”  The ministry said that India’s decision to keep importing Russian oil is based on “market factors” and is necessary for the energy security of its 1.4 billion people.

The MEA also called the move hypocritical, saying that “several other countries are also taking [similar] actions in their own national interest,” but only India is being attacked.  The statement ended with a strong promise: “India will do everything it can to protect its national interests.”