In a major blow to the medical devices sector, the US President Donald Trump imposed a steep 27% reciprocal tariff on the med tech industry on Thursday.
The move has sparked concerns among the people in the industry.
“The imposition of a 27% reciprocal tariff on Indian medical device exports to the U.S. may pose a significant challenge to the sector's growth, said Rajiv Nath , Forum Coordinator, AiMeD.
India currently levies around 5-10% import duty on medical devices from the US, while the US doesn't charge any import duty on devices from India.
“Historically, India has been a key supplier of cost-effective, high-quality medical devices to the U.S., primarily in low-value high volume consumables categories. However, this new tariff may possibly impact Indian Medical Devices exports and we have to explore windows of opportunities where USA has been seeking to diversify its supply chain dependence on any one nation,” Nath further said.
“While India may seemingly gain a marginal price advantage over China (8%) in certain low-risk, high-volume consumables , the real impact may not be significant if our prices were higher than 15% and the impact has to be further studied compared to other competing nations. “said Himanshu Baid , managing Director, Polymedicure.
“Despite the tariff challenges, India's primary obstacle remains non-tariff barriers rather than tariffs themselves. Regulatory hurdles in the U.S. are steep, with FDA approval costs ranging from $9,280 to over $540,000, whereas U.S. exporters face relatively minimal costs when entering India. Addressing these imbalances through bilateral collaboration is crucial.”he added.
The move has sparked concerns among the people in the industry.
“The imposition of a 27% reciprocal tariff on Indian medical device exports to the U.S. may pose a significant challenge to the sector's growth, said Rajiv Nath , Forum Coordinator, AiMeD.
India currently levies around 5-10% import duty on medical devices from the US, while the US doesn't charge any import duty on devices from India.
“Historically, India has been a key supplier of cost-effective, high-quality medical devices to the U.S., primarily in low-value high volume consumables categories. However, this new tariff may possibly impact Indian Medical Devices exports and we have to explore windows of opportunities where USA has been seeking to diversify its supply chain dependence on any one nation,” Nath further said.
In 2023-24, India's medical device exports to the U.S. stood at $714.38 million, while imports from the U.S. to India were significantly higher at $1,519.94 million as per data shared by Exports Promotion Council of Medical Devices.
“While India may seemingly gain a marginal price advantage over China (8%) in certain low-risk, high-volume consumables , the real impact may not be significant if our prices were higher than 15% and the impact has to be further studied compared to other competing nations. “said Himanshu Baid , managing Director, Polymedicure.
“Despite the tariff challenges, India's primary obstacle remains non-tariff barriers rather than tariffs themselves. Regulatory hurdles in the U.S. are steep, with FDA approval costs ranging from $9,280 to over $540,000, whereas U.S. exporters face relatively minimal costs when entering India. Addressing these imbalances through bilateral collaboration is crucial.”he added.
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