View: Will Trump's tariffs lift the veil on India's drug safety problem?

Donald Trump’s tariffs. Some are confident that whatever is announced on Wednesday will not hurt them; others are genuinely uncertain how to manage if they can’t export to the US.

The pharmaceutical industry — which is well known globally for churning out generic drugs that are the backbone of many countries’ health systems — should be particularly worried. Over 30% of Indian pharma exports go to the US, and it provides an even larger proportion of earnings.

Trump has promised, in the past, that levies on pharma imports would begin at 25%, similar to what he imposed on cars recently. But the president seems to have walked that back more recently, perhaps because the administration is uncertain of the consequences of a sharp rise in the price of off-patent drugs.

A spike of that sort might well cause even more of an uproar than an increase in the price of cars in a nation where health care is already unaffordable and out of reach for many citizens. By some estimates, generic and biosimilar drugs account for 90% of prescriptions filled in the US, although they represent barely over a percentage point of total health care spending. Indian-made medicines satisfy about 40% of US demand for off-patent formulations. This is one of the few ways in which American patients get a good deal. It’s possible, therefore, that pharma might be excluded from the first batch of tariffs entirely.

But Indian pharma should view that only as a temporary reprieve. Trump will eventually get around to the sector. Worse, the US — and then