India-US Trade Deal Boosts Pharma And Medtech Exports, Sharpens Edge Over China

Last Updated:February 04, 2026, 07:00 IST

Beyond tariffs, the deal is also seen as a sign of closer trade ties between India and the US, with hopes of easier regulatory processes and more reliable supply chains

Industry experts said the India-US trade deal improves market access for Indian medicines. (Image fore representation: News18)

The India-US trade agreement is set to strengthen Indian pharmaceutical and medical device exports to the United States, as lower tariffs give companies a pricing edge over Chinese rivals in the world’s largest healthcare market.

For Indian drugmakers, the US already contributes an estimated 30 percent to 40 percent of sector revenues and lower reciprocal taxes are seen as incrementally positive, especially for companies with a strong generics and biosimilars presence.

According to industry experts, the trade deal improves market access for Indian medicines, reinforces the country’s standing as a global supplier of affordable drugs and creates room for export growth by easing cost pressures.

Beyond tariffs, the deal is also seen as a sign of closer trade ties between India and the US, with hopes of easier regulatory processes and more reliable supply chains. Together, these changes could open up fresh opportunities for Indian pharmaceutical and related industries.

Namit Joshi, chairman of Pharmexcil – a pharmaceutical export body under the ministry of commerce and industry – the agreement strengthens India’s role in global healthcare by fostering greater access for Indian generics and biosimilars, as well as driving growth in pharmaceutical exports.

“The reduction in reciprocal taxes is incrementally positive for Indian pharmaceutical companies, particularly those with significant exposure to the US market, which accounts for 30% to 40% of the sector’s total revenue," Joshi said.

He pointed out that improved trade ties with the US could help Indian companies consolidate their leadership in affordable medicines while expanding innovation-led opportunities.

“By enhancing trade ties, streamlining regulatory processes, and ensuring supply chain resilience, this agreement will drive growth in India’s pharmaceutical exports, unlock new opportunities for innovation, and reinforce the country’s critical role in global healthcare," he added.

For the specialty chemicals segment that feeds into pharmaceutical manufacturing, the tariff cuts are being seen as a structural reset.

“The slashing of reciprocal tariffs to 18% is a turning point for Indian specialty chemicals," said Amitt Nenwani, managing director of Shivtek Spechemi Industries.

Nenwani said by removing “the punitive 50 percent ‘cliff’ linked to Russian energy", the deal restores global cost leadership for Indian players.

“For us, this specifically accelerates our US market penetration for high-value intermediates," Nenwani said, noting that “the immediate relief in landed costs allows us to aggressively capture market share from Chinese competitors while securing superior margins on long-term contracts."

Calling it more than a routine policy change, he said: “This isn’t just a policy shift; it’s our launchpad for 2026."

Similarly, medical device manufacturers have also welcomed the move, arguing that tariff parity – and, in some cases, advantage – against China could be decisive as global buyers diversify supply chains.

“The US tariff slash from 50% to 18% is a game-changer for Indian medical devices, slashing export costs and unlocking billions in US market potential amid China+1 shifts," said Rajiv Nath, forum coordinator of AiMeD, a lobby of domestic medical device makers.

Nath said the industry body views the agreement as “a vital boost for our manufacturers", which will enhance global competitiveness, spur investments and create jobs, while urging continued regulatory alignment between India and the US to fully capitalise on the opportunity for ‘Make in India’ medtech. He explained that the revised tariff structure changes the competitive equation with China.

“The US tariff cut to 18% on Indian goods provides Indian medical devices a competitive edge over Chinese counterparts," Nath said, pointing out that Chinese products continue to face higher Section 301 tariffs, “typically at 25% plus additional hikes" and, in some cases, “up to 50% to 60% on some items like respirators".

Earlier, he said, India faced duties of up to 50 percent while China’s were around 30 percent, but under the new deal, India’s rate falls below China’s base, favouring Indian manufacturers amid China+1 diversification.

Taken together, industry leaders argue that the India-US trade agreement does not just lower costs in the near term, but reshapes the long-term export and investment outlook for pharmaceuticals, specialty chemicals and medical devices – sectors that sit at the heart of India’s global healthcare ambitions.

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