U.S. Tariff Developments: What Indian Exporters Should Watch

Dear Valued Customer,

Potential Changes in U.S. Trade Policy May Impact Future Export Planning

Recent announcements from the U.S. administration indicate two separate trade developments that may influence global supply chains and export strategies for Indian businesses.

1. Proposed Future Tariffs on Generic Pharmaceuticals

The U.S. administration has announced a two-year transition period for imported generic medicines. During this period, generic pharmaceutical imports are expected to continue without additional tariffs. However, the proposal indicates that, after this transition, imports could face a 100% tariff, followed by a 200% tariff in the subsequent phase, with the objective of encouraging pharmaceutical manufacturing within the United States. The proposal is intended to provide manufacturers time to evaluate investments in U.S.-based production before higher duties take effect.

2. New Section 301 Forced Labour-Related Tariff Measures

The U.S. Trade Representative has also announced new Section 301 tariff measures linked to forced labour compliance. Under the current framework:

• India has been placed in the 10% tariff category under this initiative.
• Many other investigated economies are subject to a 12.5% tariff, while certain economies have separate arrangements depending on existing trade agreements and MFN treatment.

What Does This Mean for Indian Exporters?

Although these developments affect different sectors and are based on separate policy objectives, exporters should proactively:

• Review long-term export contracts with U.S. buyers.
• Monitor future tariff announcements and implementation timelines.
• Assess product classification and compliance requirements.
• Strengthen customs documentation and supply chain transparency.
• Discuss potential cost implications with overseas customers before shipment planning.

At present, these announcements should primarily be viewed as developments requiring business planning rather than immediate operational changes, particularly for exporters with long-term exposure to the U.S. market.

Eskay Global Logistics Advisory

International trade regulations continue to evolve. Whether your cargo involves pharmaceuticals, engineering products, industrial goods or general cargo, our team can assist with shipment planning, customs coordination and freight solutions to help minimise supply chain disruptions.