Zero-duty access to China boosts Indian pharma as US tariffs hit exports
In a landmark trade move, China has removed the 30 percent import duty on Indian pharmaceutical products, allowing Indian drug makers to enter the Chinese market at zero customs cost. This decision is expected to create new export opportunities worth billions of dollars for India’s pharma sector, which is already known as the “pharmacy of the world.”
The announcement comes at a crucial time. Just days earlier, the United States imposed a 100 percent tariff on pharmaceutical imports, a step that could severely impact India’s biggest export destination for medicines. While the US has traditionally been the largest buyer of Indian drugs, the new tariff makes shipments costlier and less competitive.
Why China’s move is significant
China, with its population of 1.4 billion and expanding healthcare needs, has long been a challenging market for Indian exporters. High duties and regulatory hurdles limited India’s access to this fast-growing sector. By cutting duties to zero, Beijing has opened doors for Indian pharma companies to compete on equal terms with global suppliers.
Industry analysts point out that this change could rebalance trade relations between the two countries. India has often struggled with a trade deficit in its dealings with China. Increased pharma exports could help narrow that gap while diversifying India’s overseas markets.
Moreover, access to China’s vast healthcare network could give India a stronger foothold in Asia’s pharmaceutical supply chains. This is particularly important as demand for affordable generic medicines and vaccines continues to rise globally.
Impact on India’s pharmaceutical industry
India’s pharmaceutical sector contributes more than 20 percent of global generic drug exports. With the US market becoming costlier due to tariffs, China now offers a crucial alternative.
Experts believe that zero-duty access could lead to:
- A surge in Indian pharma exports to China.
- Job creation across India’s pharma hubs such as Hyderabad, Pune, and Ahmedabad.
- Higher revenues for mid-sized and large drug makers.
- A stronger role for India in global healthcare supply chains.
Additionally, industry leaders expect that Indian firms will now be able to compete better in China’s hospital procurement programs, which often prioritize affordable medicines.
A shifting trade landscape
The timing of these developments highlights the changing global trade environment. On one hand, India faces challenges in the US due to steep tariffs. On the other, China’s policy shift offers relief and opportunity.
Observers suggest that this may also be a strategic move by Beijing to improve trade relations with New Delhi, especially at a time when economic ties between the two countries have faced strain.
For India, the opening of the Chinese market is not just an economic win but also a chance to strengthen its global reputation as a reliable healthcare partner.
The road ahead
While the duty cut is a positive step, challenges remain. Regulatory approvals, competition from local Chinese firms, and geopolitical tensions could still pose hurdles. However, the outlook is widely seen as favorable.
If India can seize this opportunity, the pharma sector could see billions in new revenue streams, boosting employment and enhancing the country’s role as a global medical supplier.
As the US market turns less friendly, China’s open door may become the next big chapter in the story of Indian pharma exports.