Winning Bizness Desk
Mumbai.US President Donald Trump’s announcement of a 25% tariff on pharmaceutical, auto, and semiconductor imports from April 25, 2025, has sent shockwaves through the Indian stock market. The pharma sector, highly dependent on US exports, faced intense selling pressure, causing significant declines in stock prices. Analysts and brokerage firms have advised investors to avoid fresh investments in the sector for now. On February 19, following Trump’s statement, the Nifty Pharma index opened 2% lower and continued its downward trend, reflecting market concerns over the impact of the tariff hike.
Pharma Stocks Witness Sharp Decline
Several major pharmaceutical companies saw their stock prices tumble in the wake of the announcement. Aurobindo Pharma closed at ₹1,123 per share, while Lupin fell to ₹1,975 per share on the BSE. Sun Pharma also experienced consecutive losses, settling at ₹1,671 per share on Thursday. Glenmark Pharma followed suit, ending at ₹1,349 per share. The overall bearish sentiment in the sector underscores the vulnerability of Indian pharmaceutical exports to changing US trade policies, making it one of the most affected industries by the tariff move.
Experts Warn of Challenges Ahead
Market analysts believe that the pharma sector is particularly susceptible to Trump’s aggressive trade policies. Satish Chandra Alluri, a research analyst at brokerage firm Lemon Markets, noted that companies with high US exposure could face major setbacks. Investment advisory firm Mantri Fanart's CEO, Arun Mantri, also highlighted the adverse impact of the proposed tariffs on Indian pharma exports. With the US being India’s top export destination, any trade restrictions could significantly disrupt revenue streams for key players in the industry. Experts caution that the sector may struggle in the near term unless alternative markets are explored.
India’s Pharma Exports at Risk
India ranks as the third-largest pharmaceutical producer globally, with exports valued at $27.85 billion in FY24, constituting 3.5% of the country’s total exports. The US remains India’s largest export partner, accounting for 11% of total exports in the previous fiscal year. The new tariff regulations could severely impact Indian drug manufacturers, forcing them to reassess their strategies. With more than nine lakh people employed in the sector, the repercussions of this tariff increase could extend beyond stock markets, potentially affecting jobs and economic growth in the industry.
