Former US President Donald Trump’s plan to impose reciprocal tariffs on India may cause huge losses not only to India but also to American citizens. Know about it? 
US tariffs:-Former U.S. President Donald Trump announced that from next month, he would impose reciprocal tariffs on Indian imports. While this move is meant to balance trade, it could backfire on Americans—especially those who rely on affordable medicines.
What Are Tariffs?
A tariff is a tax that a country places on imported goods. If a product is coming from another country, the government may impose a tariff, making it more expensive for consumers. Trump’s new tariff policy is a response to the taxes India imposes on American goods.
Why Does This Matter for Americans?
India is a major supplier of generic medicines—cheaper versions of branded drugs that are just as effective. In the U.S., nearly half of all generic drugs come from India. These medicines help millions of Americans manage diseases like hypertension, depression, and mental health disorders at affordable prices.
A study by IQVIA, a research firm, found that Indian generics saved Americans $219 billion in healthcare costs in 2022 alone. If tariffs increase the price of these medicines, millions of Americans could face higher medical bills.
Impact on the Healthcare System
- Higher Drug Prices – Indian pharmaceutical companies operate on thin profit margins. If tariffs increase their costs, they will have no choice but to raise drug prices.
- Shortage of Essential Medicines – Many companies may exit the U.S. market, leading to shortages of critical drugs.
- Increased Burden on Poor and Uninsured Americans – Many Americans already struggle to afford medicines. Higher prices will make life even harder for them.
Why Can’t America Just Make Its Own Drugs?
Trump wants American companies to manufacture more medicines within the U.S. But this is easier said than done.
- Manufacturing drugs in the U.S. costs 3-4 times more than in India.
- Setting up a new pharmaceutical facility can take 5-10 years and cost up to $2 billion.
- Many American drug companies, like Pfizer, focus on expensive, branded medicines, not cheap generics.
The Role of China
Another challenge is that 87% of the raw materials used in U.S. medicines come from other countries, especially China. The U.S. already has high tariffs on Chinese imports, making medicines more expensive. If India also faces high tariffs, medicine prices could rise sharply.
India’s Response
India exports $12.7 billion worth of medicines to the U.S. every year, and currently, there are no major tariffs on these exports. However, the U.S. charges 10.91% import tax on Indian goods, creating an imbalance.
To prevent a trade war, India may lower tariffs on American drugs. But since the U.S. exports only $500 million worth of medicines to India, this would have little impact.
What’s Next?
India and the U.S. are negotiating a trade agreement to prevent a full-blown tariff war. Trump has hinted that India is willing to reduce tariffs, but the details are still unclear.
Experts believe that by the end of this year, a deal might be reached to protect both Indian pharma companies and American consumers.
For now, millions of Americans—and the pharmaceutical industry—are waiting to see if these tariffs will become a reality, and how they will affect drug prices and healthcare access.