NEW DELHI: India could take away commerce boundaries for American medical units, one of many key asks of the US, offered Washington reciprocates with an identical remedy to Indian pharmaceutical merchandise, together with generic medicine, individuals conscious of the continuing sectoral talks beneath the proposed Indo-US bilateral commerce settlement (BTA) stated.
Whereas the US levies zero responsibility on most prescription drugs, American medicine entice 0-10% tariff in India. (REUTERS FILE PHOTO)
The US has raised particular tariff and non-tariff points associated to exports of its pharmaceutical merchandise and medical units within the Indian market, and the negotiators of either side are seized of the matter, they stated, requesting anonymity. Hindustan Instances on Saturday reported that the US and India are “intensely” engaged in sector-specific talks by way of the digital mode.
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India exported medicine and prescription drugs value $27.85 billion in FY24 with 9.7% year-on-year progress and the sector’s exports already neared $27 billion within the first 11 months of FY25 with 7% annualised progress. The US is its largest market with little over 30% share within the sectoral export pie. Whereas the US levies zero responsibility on most prescription drugs, American medicine entice 0-10% tariff in India.
Though the US has to this point stored pharma sector out of its reciprocal tariffs’ purview, President Donald Trump just lately (on April 8) spoke a couple of forthcoming “major” tariff on pharmaceutical merchandise. It may very well be a sector-specific levy as has been the case of metal, they stated, requesting anonymity.
“It is likely that the US could levy a sectoral tariff on pharmaceutical imports. But the impact could be temporary as it is a major component of the BTA. The first tranche of the BTA is expected to be finalised by the second quarter of FY25. Meanwhile, the Indian pharma industry and exporters have been asked to de-risk their business and diversify their markets,” certainly one of them stated.
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The sector is vital for President Trump because it was talked about within the truth sheet accompanying the April 2 govt order, the place the US introduced country-specific reciprocal tariffs, a second individual stated.
“India imposes their own uniquely burdensome and/or duplicative testing and certification requirements in sectors such as chemicals, telecom products, and medical devices that make it difficult or costly for American companies to sell their products in India. If these barriers were removed, it is estimated that U.S. exports would increase by at least $5.3 billion annually,” the very fact sheet stated.
“The BTA is being negotiated on the principle of reciprocity. A win-win deal for both partners is expected soon, which will also give greater market access to the Indian pharma industry and help it to establish a robust supply chain,” the primary individual stated. India could align its high quality norms with worldwide benchmarks that may reduce hassles for regulatory approvals, necessities, and certification for American merchandise within the Indian markets, he stated.
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There’s a precedent within the India-United Arab Emirates (UAE) Complete Financial Partnership Settlement (CEPA), he stated. For the primary time in any commerce settlement, a separate annexure on prescription drugs has been integrated to facilitate entry of Indian pharmaceutical merchandise, particularly automated registration and advertising authorisation in 90 days for merchandise accredited by developed nation regulators specifically the USA (USFDA), the UK (UKMHRA), the European Union (EMA), and Japan (PMDA), he added.
In response to the division of prescription drugs, the Indian pharmaceutical business is the world’s third largest by quantity and the 14th largest by worth. The entire annual turnover of prescription drugs was ₹4,17,345 crore for the monetary yr 2023-24 and has grown at a median of 10.08% over the past 5 years. In FY 2023-24, the entire worth of prescription drugs exported was ₹2,19,439 crore whereas that of pharmaceutical imports was ₹58,440 crore.
India is the world’s the biggest provider of generic medicine, accounting for about 20% of world provide. It manufactures about 60,000 generic manufacturers, throughout 60 therapeutic classes, it stated.
“Access to affordable treatment for HIV from India is one of the great success stories in modern medicine. Because of their low price coupled with quality, Indian medicines are preferred worldwide, thereby earning the country the epithet ‘pharmacy of the world’,” it added.