America’s 50 percent tariff will not affect these sector including India’s pharma

Additional tariff from America on India has come into force today (27 August 2025). Additional tariffs are expected to cause moderate pressure on labor based industries such as textiles and gems and jewelery, while industries like drug, smartphone and steel will remain untouched by this effect of tariffs due to existing tariff structures and strong domestic consumption.

A latest report by SBI Research states that American tariff may affect the US GDP 40-50 basis points. The report said, “50 per cent of tariffs will affect $ 45 billion exports, in the worst, India’s trade surplus will turn into a trade deficit. However, we believe that business talks will restore confidence and improve exports to America.”

Drug imports discounts from India
America has exempted drug imports from India. India stake in 2025 in the total drug imports of America was 6 percent and in FY 25, 40 percent of India’s drug exports was recorded to the US. Meanwhile, due to the effect of recent tariffs and weak dollars, new inflationary pressure signs in the US, especially in import-sensitive areas such as electronics, autos and consumer durables, have started appearing.

These countries will benefit due to India
Between high tariffs, India’s product may lose their ability to compete, which may potentially benefit countries such as China and Vietnam. The reason for this is that the tariff imposed on India is more than other Asian countries. The tariff rate is 30 percent for China, 20 percent for Vietnam, 19 percent for Indonesia and 15 percent for Japan. According to the report, “America remains India’s largest textile export destination. In the last five years, India has steadily increased clothing market share, while China’s share has declined.

This change reflects India’s growing importance in the American Supply Chain system. The US remains the largest market for gems and jewelery sectors, which is about one third of the region’s annual exports of $ 28.5 billion. With the US tariffs being increased from 25 percent to 50 percent, exporters are ready for significant disruption.

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