Pharma sector faces tariff threats amid rising US trade actions: Report
New Delhi [India]Pharmaceuticals, one of India’s largest export winners, may be forced if the United States announced new tariffs, Fitch Ratings warned in a new Fitch Tel report.
The rating agency said that while Indian companies are generally exposed directly to existing US tariffs, the pharmaceutical industry is vulnerable to future trade measures. The US is a key market for Indian drug producers and can fluctuate throughout the industry imposing any tariff.
According to the report, Biocon Biologics Limited, which focuses on biobenzers, is exposed to approximately 40 percent of its income from the United States. The products of the company are mainly produced in India and Malaysia.
Fitch said that the US’s important tariffs on pharmaceutical exports may damage Biocon’s performance and that the higher costs to consumers may be difficult even in a competitive market with stable demand for their drugs.
The warning comes after Washington has brought a 25 percent mutual tariff to Indian goods from August 7, 2025, and 25 percent more tax due to Russian oil imports, which came into force on 27 August.
Automobiles and chemicals also face risks, but exposure is limited compared to the drug. Samvardhana Motheron International Limited, which supplies automobile components, is close to 20 percent of sales from the United States, but mainly winning through production bases in the United States and Mexico.
Fitch said that the company reviewed the “positive” appearance “stable” earlier this year and referred to the uncertainty of tariff cuts in the global automobile industry.
Major UPL Limited, crop protection, could have felt heat with about 10-12 percent of the US revenue. The products produced in India are expected to face tariffs closer to those imposed on Chinese imports.
The effect of tariffs extends beyond production. Russian crude oil, which constitutes 30-40 percent of India’s oil imports, continues to support the profitability of government-owned oil marketing companies. Fitch estimates that there is a 10 percent decrease in its earnings in case of a complete stop in Russian purchases, but government support will keep credit ratings constant.
For now, it assumes a limited tariff effect on sectors such as Fitch, CT services, cement, telecom and public services. However, if the tariffs remain higher than other Asian markets, the report warned that India’s 6.5 percent growth may be under pressure for 26 financial years.
This article was created from an automatic news agency feeding without changing the text.
