India among 20 nations exempt from heavy US specialty drug tariffs

India is among 20 countries eligible for a zero per cent tariff on certain specialty pharmaceutical products and their associated ingredients under a notice issued by the US Commerce Department. The waiver comes as the US prepares to impose a 100 per cent ad valorem tariff on specified licensed and patented pharmaceutical products and ingredients under Section 232 of the Trade Expansion Act. President Donald Trump issued an official proclamation on April 2 to adjust pharmaceutical imports and encourage domestic production. The tariff took effect on July 31 for companies listed in one annex and is scheduled to apply to other covered companies from September 29. However, the Commerce Department stated that generic pharmaceutical products and their associated ingredients are not currently subject to these Section 232 tariffs.

Covered Products

The zero-tariff waiver applies to specific categories of specialty medicines rather than the wider pharmaceutical trade. Eligible products include orphan drugs used to treat rare diseases, nuclear medicines, plasma-derived therapies, fertility drugs, cell and gene therapies, antibody-drug conjugates, and animal medicines. The ingredients used in these products receive the same treatment. The Commerce Department also permits companies to seek tariff relief for specialty drugs needed to address urgent health needs on a case-by-case basis. Additionally, zero tariffs are allowed on certain products imported only for clinical trials, research, development, or other non-commercial uses.

Global List

India is listed alongside 19 other jurisdictions. These include Argentina, Bangladesh, Cambodia, Ecuador, El Salvador, the European Union, Guatemala, Indonesia, Japan, Jordan, Malaysia, North Macedonia, South Korea, Switzerland and Liechtenstein, Taiwan, Thailand, the United Kingdom, and Vietnam. Qualifying products from these regions can receive a zero tariff because they have, or are expected to have, a trade and security framework agreement with the US.

Context

Generic medicines make up a major share of India's drug exports to the US, a market where the country exported pharmaceuticals worth $30.46 billion in 2024-25 according to the Pharmaceuticals Export Promotion Council of India. Trade policies involving targeted tariffs and exemptions under national security provisions often use specific country lists tied to bilateral agreements.