Shares of Indian pharma companies with significant exposure to the US, including Gland Pharma, Aurobindo Pharma, Dr. Reddy's Laboratories, and Sun Pharma, surged by up to 14% on Thursday, April 3, after U.S. President Donald Trump refrained from imposing new reciprocal tariffs on the sector.
By 9:40 AM, all the constituents of the Nifty Pharma index were trading in the green.
Gland Pharma shares were the top gainers in the sector, soaring by 14.3%, followed by Aurobindo Pharma, which saw a rise of 9.4%. Shares of Lupin, Zydus Lifesciences, and Dr. Reddy’s Laboratories also surged by nearly 7%.
Meanwhile, shares of Granules India, Ipca Laboratories, Sun Pharmaceuticals, Glenmark Pharmaceuticals, Laurus Labs, Divis Laboratories, Cipla, Biocon, and Natco Pharma rose by 4-6%.
Trump announced tariffs on more than 60 countries, including India, the European Union, China, and Vietnam. However, pharmaceuticals and certain other products remain exempt, according to a White House fact sheet.
While sector-specific tariffs were not part of the latest announcement, Trump has previously hinted at possible levies on pharmaceuticals, semiconductors, and other industries. However, he did impose a 25% tariff on auto imports.
Currently, India charges a 10% tariff on Pharma imports from the US, while the US does not impose any tariff on imports of Indian pharmaceutical items.
Also Read: Gold, not Bitcoin, is the real threat to the Dollar, says Peter Schiff
Sectors that will be hit hard by the tariffs
Nearly $14 billion worth of electronics products and over $9 billion worth of gems and jewellery are among the top sectors to be hit by the U.S. tariffs. While the 26% tariff will not apply to auto parts and aluminium products, those will still attract the 25% tariff that Trump had announced earlier.
The White House said pharmaceutical products, which comprise nearly $9 billion worth of exports from India as per government data, and energy products are exempt under the latest round of tariffs.
Washington's previous sector-wide average tariffs on India for automobiles, gems and jewellery, chemicals and pharmaceuticals and electronic products stood at 1.05%, 2.12%, 1.06%, and 0.41%, respectively, as per Global Trade Research Initiative.
Also Read: T rump's tariffs send markets reeling, amid trade war and recession fears
India & US' trade ties
PM Modi, who was one of the first foreign leaders to meet Trump after his return to the Oval Office, recently lavished praise on the US president, underscoring their close personal ties. The two nations agreed to conclude the first tranche of a trade deal by the fall of this year and boost bilateral trade to $500 billion by 2030, up from $127 billion in 2023, following the meeting.
From 2021-22 to 2023-24, the US was the largest trading partner of India. The US accounts for about 18 per cent of India's total goods exports, 6.22 per cent in imports, and 10.73 per cent in bilateral trade.
With India, America has a trade surplus (difference between imports and exports), of USD 35.32 billion in goods in 2023-24. It was USD 27.7 billion in 2022-23, USD 32.85 billion in 2021-22, USD 22.73 billion in 2020-21 and USD 17.26 billion in 2019-20.
( Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
By 9:40 AM, all the constituents of the Nifty Pharma index were trading in the green.
Gland Pharma shares were the top gainers in the sector, soaring by 14.3%, followed by Aurobindo Pharma, which saw a rise of 9.4%. Shares of Lupin, Zydus Lifesciences, and Dr. Reddy’s Laboratories also surged by nearly 7%.
Meanwhile, shares of Granules India, Ipca Laboratories, Sun Pharmaceuticals, Glenmark Pharmaceuticals, Laurus Labs, Divis Laboratories, Cipla, Biocon, and Natco Pharma rose by 4-6%.
Trump announced tariffs on more than 60 countries, including India, the European Union, China, and Vietnam. However, pharmaceuticals and certain other products remain exempt, according to a White House fact sheet.
While sector-specific tariffs were not part of the latest announcement, Trump has previously hinted at possible levies on pharmaceuticals, semiconductors, and other industries. However, he did impose a 25% tariff on auto imports.
Currently, India charges a 10% tariff on Pharma imports from the US, while the US does not impose any tariff on imports of Indian pharmaceutical items.
Also Read: Gold, not Bitcoin, is the real threat to the Dollar, says Peter Schiff
Sectors that will be hit hard by the tariffs
Nearly $14 billion worth of electronics products and over $9 billion worth of gems and jewellery are among the top sectors to be hit by the U.S. tariffs. While the 26% tariff will not apply to auto parts and aluminium products, those will still attract the 25% tariff that Trump had announced earlier.
The White House said pharmaceutical products, which comprise nearly $9 billion worth of exports from India as per government data, and energy products are exempt under the latest round of tariffs.
Washington's previous sector-wide average tariffs on India for automobiles, gems and jewellery, chemicals and pharmaceuticals and electronic products stood at 1.05%, 2.12%, 1.06%, and 0.41%, respectively, as per Global Trade Research Initiative.
Also Read: T rump's tariffs send markets reeling, amid trade war and recession fears
India & US' trade ties
PM Modi, who was one of the first foreign leaders to meet Trump after his return to the Oval Office, recently lavished praise on the US president, underscoring their close personal ties. The two nations agreed to conclude the first tranche of a trade deal by the fall of this year and boost bilateral trade to $500 billion by 2030, up from $127 billion in 2023, following the meeting.
From 2021-22 to 2023-24, the US was the largest trading partner of India. The US accounts for about 18 per cent of India's total goods exports, 6.22 per cent in imports, and 10.73 per cent in bilateral trade.
With India, America has a trade surplus (difference between imports and exports), of USD 35.32 billion in goods in 2023-24. It was USD 27.7 billion in 2022-23, USD 32.85 billion in 2021-22, USD 22.73 billion in 2020-21 and USD 17.26 billion in 2019-20.
( Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
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