Trump’s pharma tariffs won’t impact India for now, says expert
US tariffs on patented drugs won’t hit Indian pharma immediately, says Bhaskar Chakravorti, but future risk to generics remains. He urged India to cut Russian oil imports as a signal to Washington.
Washington: Bhaskar Chakravorti, Dean of Global Business at The Fletcher School of Law and Diplomacy at Tufts University, has said that US President Donald Trump’s decision to impose 100 per cent tariffs on pharmaceuticals will not immediately impact India.
In an exclusive interview with IANS, Chakravorti cautioned that the move could be a precursor to future action on Indian generics.
“This specific move to put tariffs on patented pharmaceuticals is not something that is directly going to affect Indian manufacturers as much, but it’s coming awfully close. I wouldn’t rule out tariffs on generic pharmaceuticals down the road,” he said.
Trump announced on Thursday that any patented or branded pharmaceutical products would be subject to a 100 per cent tariff starting October 1, unless the manufacturer sets up a plant in the US.
On India–US trade talks, Chakravorti said negotiations should continue despite friction over H-1B visas. “There is mutual benefit in continuing these conversations and finding a settlement to the tariff impasse. The H-1B issue is related, but separate, and needs parallel negotiation,” he noted.
Sources have told IANS that India is pushing for tariffs below 20 per cent to remain competitive, while also pressing for removal of the additional 25 per cent duty on Russian oil purchases.
Chakravorti, a former McKinsey & Company Partner, advised India to consider reducing Russian oil imports as a signal to Washington. “That would probably be the biggest move India can make to get Trump’s attention. India can still argue this is not economically feasible but it helps Trump’s claim of campaigning for peace,” he said.
He acknowledged that Trump’s current economic policies are already hurting the US economy. “Consumer demand will be hit. Other countries have no substitute for the US market. You can put together 50 markets and it still doesn’t add up to cover the deficit,” he stressed.
For India, Chakravorti said, the priority should be to maintain a working strategy with Washington. “The biggest problem right now is Trump. But he is also transparent about what gets him upset and what makes him happy. India must use that to develop a near-term strategy and, over the long term, campaign to rebuild the relationship,” he concluded.