Full Breakdown
United States Expands 100 % Tariff on Indian Patented Drugs, Carves Out Zero-Duty for Select Specialty Medicines
By Drooid · · How we work
Expanded Tariff and Zero-Duty Carve-Out
On July 31, the United States implemented a 100 % tariff on a broader set of patented pharmaceutical imports from India under Section 232 of the US Trade Expansion Act. The measure was extended on September 29 to additional companies covered by the same statute. While the levy targets many patented products, generic medicines and their ingredients remain entirely exempt. A separate carve-out grants zero-duty treatment to specified specialty medicines and related ingredients.
Scope of the Zero-Duty Exemption
The exemption applies to drugs used exclusively for rare diseases, nuclear medicine, plasma-derived therapies, fertility treatments, cell and gene therapies, antibody-drug conjugates, and animal-health products. India is also listed among 20 countries and jurisdictions eligible for zero tariffs on some specialty medicines. Patented medicines that do not meet these criteria continue to face the full tariff.
Trade Impact and Statistics
According to the Pharmaceuticals Export Promotion Council of India, Indian drug shipments to the United States were worth about $10 billion in the year ended March 2025, representing roughly 35 % of the sector’s overseas sales. The same council reports that India exported $24.15 billion of generics globally in FY 25, maintaining its position as the world’s largest generic exporter by volume. Data supplied by the White House indicate that 53 % of patented pharmaceutical products distributed in the United States were produced abroad in 2025, while only 15 % of patented active pharmaceutical ingredients by volume were manufactured domestically.
Official Responses and Ongoing Trade Talks
India’s Commerce and Industry Minister Piyush Goyal began a visit to Washington concurrent with the tariff change, meeting US Trade Representative Jamieson Greer to discuss broader trade issues. Washington officials framed the tariff expansion as a step toward reducing reliance on imported patented medicines and encouraging domestic production. Indian officials emphasized the partial relief for specialty medicines and the continued exemption for generics as mitigating factors for bilateral trade.