Trump Announces Upto 200% Tariffs On Generic Drugs, Move May Impact India

The United States has announced steep tariffs on imported generic drugs from August 2028. The move, according to US President Donald Trump, was aimed at onshoring production of such pharmaceutical products. The move is likely to affect India -- the largest exporter of generic drugs to the US.

Taking to his Truth Social platform, Trump said the phased tariff plan will come into effect from August 1, and for the first two years, the United States will continue to have a zero per cent tariff on all generic drugs brought into the country. For the third year, the tariff will be raised to 100 per cent, and it will be 200 per cent thereafter, he said.

What Trump Said

"Effective August 1st, 2026, all generic drugs being brought into the United States will continue to have a tariff of zero percent for two years, after which the tariff will be raised to 100 per cent for one year, and 200 per cent thereafter," Trump wrote.

"This is done in order to RESHORE generic pharmaceutical production into America, with a penalty to those companies that decide not to build plants and equipment within the stated period of time given to them," he added.

The president said the objective of this policy is to protect the people of the United States.

"The Policy on Patented, Branded, or Innovative Drugs, which has been so successful, will remain as is," he said.

How The Move Will Affect India

India is often called the "pharmacy of the world" as it supplies generic medicines to countries across the globe. In the US, Indian generic medicines make up nearly 40 per cent by volume. In financial year 2024-2025, India exported USD 9.7 billion worth of pharmaceuticals to the US, accounting for 38 per cent of its total global pharma exports of USD 25.8 billion, a Global Trade Research Initiative report said.

Still, it was immediately unclear how Trump's new tariff threats will affect Indian drug companies. India and the US struck a trade pact in February, which stipulates that India would "receive negotiated outcomes with respect to generic pharmaceuticals and ingredients." 

But his previous threats to tariff pharma suppliers had put cheap supplies from India at risk. Indian generic medicines are widely prescribed for hypertension, depression, diabetes, cancer, infectious diseases, and mental health. In the case of birth control, roughly 65 per cent of all pill prescriptions in the US in 2024 were manufactured by just two India-based companies, Glenmark Pharmaceuticals Ltd. and Lupin Ltd., it found, according to a report by Financial Post.