Trump’s tariffs hit tomorrow: India’s metals, autos safe, pharma’s fate uncertain

The United States has officially notified additional 25% tariffs on Indian imports, set to take effect from August 27 (9:31 am IST). But a closer look at the notification reveals a key detail: several major Indian exports, including iron, steel, aluminium, copper, automobiles, and certain electronics, are exempt from these duties.

Buried in the annex are carve-outs for products listed under specific HTSUS headings, notably those related to base metals, vehicle parts, and industrial derivatives. This gives Indian exporters some breathing room — at least initially.

But how long will these exemptions last — especially for pharma, given what Donald Trump just said?

On August 25, the US president issued a sharp warning: drug prices in the US would be slashed by 1,400% to 1,500%, and tariffs on imported pharmaceuticals could go as high as 250%. “Going to do a number on costs of drugs in the US,” he said during a briefing, signalling an aggressive move to force companies to slash prices and relocate manufacturing.

Trump’s administration has already set a September 29 deadline for top pharma giants — including Pfizer, J&J, GSK, Merck, and Novartis — to extend their “most-favored-nation” drug pricing to all Medicaid patients. Failure to comply, Trump warned, would prompt the use of “every tool in our arsenal,” including tariffs.

In a CNBC interview earlier this month, Trump floated a three-stage pharma tariff plan:

• Start with a “small” import duty,
• Ramp to 150% within 18 months,
• Possibly 250% thereafter.

While India’s pharmaceutical exports — a $25 billion-plus annual business — are not directly named in the latest exemptions, they remain exposed to future tariff waves, especially if Trump targets low-cost generic drug makers.