In February, US President Donald Trump called India a “tariff king” and claimed it was difficult to sell goods in the country.
However, with the announcement of tariff rates, a list of items exempt from these tariffs has been released. This list is beneficial to India, particularly the pharmaceutical sector.
Trump Tariffs Exemptions: What’s Not Affected
Along with announcing the tariff rates, the US also published a list of goods that will not be impacted by these new tariffs, set to take effect on April 5.
The exempted items include pharmaceuticals, semiconductors (chips), wood products, copper, gold, certain energy items, and minerals that are not available in the US.
Additionally, aluminum, steel, and auto components were excluded because they are already subject to duties under Section 232.
How India Benefits from Pharma Exemption
This exemption is significant for India, as it temporarily shields pharmaceutical products from the tariffs.
Currently, India charges a 10% tariff on pharma imports from the US, while the US doesn’t impose any duty on pharma imports from India. This trend will continue, benefiting India’s pharma sector.
The US initially planned to impose reciprocal tariffs, meaning it would match any tariff India imposes on American goods.
However, the US has now decided to apply a discounted tariff, imposing only half the rate on other countries.
Experts believe the pharma sector in India has received major relief, as the country imports $800 million worth of pharma products from the US and exports $870 million in return.
Additionally, India’s electronics sector could also benefit, as heavy tariffs on countries like Vietnam might lead to a shift in business.
