Trump announces upto 200% tariffs on generic drugs, move may hit India

Announcing the decision on his Truth Social platform, Trump said the policy is designed to encourage pharmaceutical companies to establish manufacturing facilities in the US.

In Short

• Zero tariff on imported generic drugs to continue until August 2028
• Tariff to rise to 100% for one year, followed by 200% thereafter
• India's $9.7 billion pharma exports to the US could face a major impact

US President Donald Trump on Wednesday announced sweeping tariffs on imported generic medicines, saying the measure is aimed at bringing pharmaceutical manufacturing back to the United States. The decision could have major implications for India, the world's largest supplier of generic drugs and one of the biggest exporters of medicines to the US.

Under the new policy, imported generic medicines will continue to attract a zero per cent tariff for two years from August 1, 2026. From August 1, 2028, the tariff will rise to 100 per cent for one year before increasing to 200 per cent thereafter.

India might get affected by the latest move. According to a Global Trade Research Initiative (GTRI) report, India exported pharmaceuticals worth $9.7 billion to the US in 2025, accounting for 38 per cent of its total global pharmaceutical exports of $25.8 billion. Indian generic medicines are widely used in the US for treating conditions such as hypertension, diabetes, cancer, infectious diseases and mental health disorders, making the American market crucial for the country's pharmaceutical industry.

Announcing the decision on his Truth Social platform, Trump said the policy is designed to encourage pharmaceutical companies to establish manufacturing facilities in the US. Companies that fail to shift production during the transition period would face the steep tariff regime.

"The objective of this policy is to protect the people of the United States," Trump wrote, adding that the existing policy for patented, branded and innovative medicines would remain unchanged. He also claimed that pharmaceutical manufacturing facilities are being built across the US at an unprecedented pace.

The announcement is the latest step in Trump's 'America First' trade agenda, which seeks to boost domestic manufacturing through higher import duties. Industry observers believe the proposed tariffs could reshape global pharmaceutical supply chains and pose fresh challenges for Indian drugmakers that derive a significant share of their revenue from exports to the US.

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With PTI inputs