Pharmexcil pushes for market access as US mulls tariffs on Indian drugs

Amid looming U.S. tariff hikes on imported active pharmaceutical ingredients (APIs) and finished pharmaceutical formulations, government-backed trade promotion body the Pharmaceuticals Export Promotion Council of India (Pharmexcil) is stepping up efforts to secure greater market access and policy support, with the ambitious goal of pushing India's pharmaceutical exports to $65 billion by 2030.

The sector is already on a growth trajectory, with exports reaching $27.9 billion in the fiscal year 2023-24 (April 2023–February 2024), according to Pharmexcil data. The United States remains India’s largest export destination, accounting for $8.7 billion in the fiscal year 2022-23, but regulatory and trade barriers continue to pose challenges. In response, Pharmexcil is intensifying efforts to address non-tariff barriers such as regulatory approvals, import restrictions, and pricing controls in key markets.

The United States is considering imposing a 25% tariff on imported pharmaceuticals, including APIs and finished drugs, as part of a broader strategy to reduce its trade deficit and boost domestic manufacturing. While primarily aimed at China, the move could significantly impact India as well, given that both countries supply over 70% of APIs used in the U.S. The tariff could make Indian exports less competitive, affecting Indian pharmaceutical companies that rely on the U.S. market.

“The council is actively monitoring policy developments in the United States and other key markets to ensure Indian pharmaceutical companies do not face undue trade restrictions. We are also working closely with the government to strengthen domestic manufacturing,” Bhavin Mukund Mehta, Vice-Chairman of Pharmexcil, told Business Today.

To tackle trade challenges, Pharmexcil is urging Indian exporters to report specific hurdles so they can be escalated to government authorities for resolution. The council has already intervened in cases involving import restrictions, regulatory barriers, and pricing issues that were limiting exports. “Our aim is to ensure uninterrupted global access for Indian pharmaceutical products,” Mehta said.

Beyond the U.S., India is expanding its presence in Africa, Latin America, and Southeast Asia, where demand for affordable generic drugs and biosimilars is growing. “These regions are increasingly looking at India for cost-effective healthcare solutions, and we are working to ensure Indian exporters gain smooth entry into these markets,” Mehta added.

At the same time, India is working to reduce its dependence on China for APIs. The country still imports nearly 65% of its API requirements from China, but the ₹15,000 crore Production Linked Incentive (PLI) scheme for bulk drugs is expected to accelerate domestic API production. Pharmexcil is facilitating industry investments and regulatory approvals to support this transition. “API self-sufficiency is critical for the long-term sustainability of the industry. We are helping companies secure approvals and investments under the PLI scheme to strengthen India’s position as a global supplier of key drug ingredients,” Mehta said.

The Indian pharmaceutical industry’s export growth is being driven by a combination of increasing global demand for biosimilars and complex generics, strengthening API production through domestic investments, and targeted expansion into emerging markets. Resolving trade barriers in key regulated markets remains a priority, he added. Despite ongoing challenges, Mehta is optimistic. “We are confident in reaching $65 billion in exports by 2030. The focus is not just on volume but on value-added pharmaceutical products,” he said.