100% on pharma, 50% on furniture: Trump fires new tariff salvo, who in India gets hit hardest?

A sweeping wave of U.S. tariffs—led by a 100% tax on imported branded pharmaceuticals—is threatening to derail billions in Indian exports, putting pressure on pharma giants, MSMEs, and key manufacturing sectors. The tariffs, effective October 1, are aimed at forcing foreign companies to localize production in the U.S.

100% tariff on branded/patented drugs

Applies to all imported branded or patented drugs unless the exporter is actively building a U.S. plant (defined as “under construction” or “breaking ground”).

Generic drugs are not directly targeted, but complex generics and specialty medicines may face scrutiny.

Impact:

• The U.S. is India’s largest pharma market ($3.6B in 2024, higher in 2025 YTD).
• Sun Pharma, Dr. Reddy’s, Cipla, and Aurobindo are heavily exposed.
• Stock prices fell up to 6% on earlier tariff threats.
• Companies without U.S. plants risk steep margin cuts, market share loss, and revenue decline.
• Broader investor sentiment remains weak due to regulatory uncertainty.

50% tariff on kitchen cabinets & bathroom vanities

Targets all imports of cabinets, vanities, and associated furniture products.

Impact:

• Indian exporters have been gaining ground in this sector due to competitive pricing.
• A prolonged 50% tariff could reduce U.S. orders, causing job losses and factory slowdowns.
• MSMEs most vulnerable due to limited pricing power.
• Long-term drag on GDP growth estimated at 0.3–0.5% if tariffs remain in place.

30% Tariff on upholstered furniture

Applies to all imported upholstered furniture products.

Impact:

• India’s MSMEs in furniture manufacturing face stiff competition from low-tariff exporters.
• U.S. buyers may turn to alternative suppliers, shrinking India’s export volumes and margins.
• Sector may be forced to pivot to new markets, limiting revenue growth.

25% Tariff on heavy-duty trucks

Affects all heavy-duty truck imports not made in the U.S.

Impact:

• Indian exports in this segment face potential losses of $4–5 billion.
• New U.S. truck orders could drop 20–30%.
• Auto and engineering manufacturers may shift focus to China, Europe, or Latin America.
• Short-term revenue declines are expected across the board.

Broader consequences

• Additional sectors—textiles, gems, chemicals, jewelry—also face tariffs up to 50%.
• Stock market pressure is growing on Indian pharma, furniture, and engineering companies.
• MSMEs and export-focused businesses face elevated financial risk.