India vs. Trump's Tariff War: Will the 'Pharmacy of the World' Be Shut Out of the US?

For years, India has proudly held the title of the “Pharmacy of the World,” not as a symbolic phrase, but as a reflection of its critical role in global health security. Indian pharmaceutical companies have made affordable, accessible, and reliable medicines available to millions of people across the globe from Africa to the United States. However, this global position now faces a serious challenge. Former US President Donald Trump has announced a 100 percent tariff on branded and patented medicines starting October 1, a move that threatens to disrupt not only India’s pharmaceutical exports but also the affordability of medicines in the US.

India's strength in pharmaceuticals is undisputed. In the fiscal year 2023–24, India exported $27.85 billion worth of medicines and pharmaceutical products, with $9 billion—nearly a third—going to the United States alone. In fact, around 47 percent of the generic medicines used in the US are imported from India. These aren’t just statistics; they are the lifeline of the American healthcare system. According to IQVIA, Indian medicines saved the US healthcare system $220 billion in 2022 alone, with savings reaching $1.3 trillion over the past decade.

Trump’s tariff decision is rooted in his “Make America Great Again” agenda, which aims to bring manufacturing back to the US. However, the issue becomes complicated when it comes to India’s branded generic medicines—off-patent drugs that are sold under a brand name, such as Crocin or Nise. While these are legally considered generics in India, US regulations often classify them as patented, leading to confusion that could bring Indian pharmaceutical exports under the scope of the new tariffs.

This puts Indian pharma companies like Glenmark, Lupin, and Sun Pharma in a vulnerable position. They manufacture and export essential medications for conditions such as hypertension, depression, diabetes, and reproductive health—drugs that are widely used across the US. If these medications become subject to the new tariffs, prices will rise significantly for American consumers, and the demand for Indian exports will fall, hurting both sides. India cannot match the US in subsidies or monetary flexibility. Its cost advantage comes from lower labor and operational costs. If Indian companies are forced to manufacture in the US to avoid tariffs, the affordability that makes generics so essential will vanish.

Many analysts see Trump’s decision not merely as economic policy, but as a political move—a direct counter to Prime Minister Narendra Modi’s “Make in India” initiative. It reflects a deeper ideological divide: where India and other developing nations aim to integrate into global supply chains, Trump’s America First approach seeks to pull everything within its own borders, even if it compromises global cooperation. Previously, China was the focus of Trump’s trade war. Now, India appears to be the next target. Unlike China, which retaliated aggressively, India has shown restraint. But it does have strategic tools at its disposal. For instance, India could rethink its cooperation with the US on data free flow and digital frameworks—areas of increasing importance in global tech governance.

Looking ahead, India must approach this challenge strategically. First, the crisis should be framed as a global health concern rather than just a trade issue. India has a strong and influential lobby in the US, and it should leverage this to highlight how the tariffs will harm American healthcare consumers, not just Indian exporters. Second, India could propose joint manufacturing or co-production agreements with US pharmaceutical companies. This would allow some alignment with Trump’s domestic manufacturing goals, while still preserving India's role in the supply chain. Third, India must firmly resist pressure to extend patent protections, which would severely restrict the production of affordable generics. Instead, it should strengthen its leadership among developing nations, focusing on expanding pharmaceutical exports to Africa, Latin America, Southeast Asia, and other emerging markets where demand is rising.

So, will Trump’s move undermine India’s pharmaceutical power? Possibly—but the answer is not that simple. India’s pharmaceutical industry is no longer just a low-cost alternative; it is an indispensable part of the global health ecosystem. Tariffs might put pressure on Indian companies, but the US also risks creating a healthcare crisis for its own people by raising drug prices and disrupting a dependable supply chain. This is not the time for India to retreat. Instead, it must double down on its strengths, promote generic medicines as global public goods, and assert its role as a provider of high-quality, affordable healthcare solutions to the world.

India’s success as the “Pharmacy of the World” is not built solely on cheap labor. It stands on decades of experience, regulatory compliance, product reliability, and a humanitarian vision of healthcare access. No tariff can take that away. If Trump’s decision is a political statement, then India’s response must be a strategic one—calm, calculated, and global in scope.