US shock to indian pharma sector, trump warns...?
US President donald trump warned that the exemption given to pharmaceuticals from reciprocal tariff will end soon. india exports a large amount of pharmaceuticals to the US. On tuesday night, he said, "We are going to announce a big tariff on pharmaceuticals very soon."
Will pharma tariff create chaos?
Trump's statement came at a time when the reciprocal tariff imposed by the US has come into effect from Wednesday. He mentioned china in his speech at the National Republican Congressional Committee dinner in Washington, but did not mention india, which sends 31.5 percent of its pharma exports to the US.
The US had announced a 27 percent reprocal tariff on india last Wednesday. trump said that when pharma companies will get information about the tariff, they will leave china and other countries, because they have to sell more of their production in the US.
Pharma companies will open plants across the country - Trump
The President further said, "After the tariff, all pharma companies will open plants in the next parts of the country." When President trump announced the reciprocal tariff last week, he exempted pharmaceuticals, copper, semiconductors, wood, bullion, energy and some minerals from tariffs, as they are extremely important to the US economy. Pharmaceuticals got relief in the reciprocal tariff because imported medicines, especially generic medicines coming from india, help keep the cost of the US health system low, which is one of the most expensive health systems in the world.
A situation of trade war has arisen
India and the US are working on a bilateral trade agreement to reduce the impact of tariffs. Healthcare data and analytics company IQVIA said that four out of ten prescriptions given in the US in 2022 were from indian companies. A situation of trade war has arisen after the US imposed reciprocal tariffs. In response to the 34 percent tariff announced by china last week, the US announced an additional 50 percent tariff on imports from China. The additional 50 percent tariff will increase the US tariff on Chinese imports to 104 percent. Trump's reciprocal tariff has raised fears of recession.
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