Rajiv Nath, Forum Coordinator at AiMeD:
“Its premature to comment on US-India tariffs until official announcement. If duties by USA on Indian medical device duties are 15-20 per cent lower than US tariffs on China, exports could rise if manufacturers find it feasible to absorb FDA approval costs and deeming these export costs sustainable.
US buyers are looking to diversify their supply chains away from China, and India represents a viable alternative, assuming it can ensure quality, competitive pricing, and agility, while also adhering to environmental, social, and corporate responsibility standards.”
Nath further cautioned that India could face a loss of competitiveness to Indonesia and Vietnam especially in rubber-based products due to their advantageous 19 per cent tariffs within China+1 procurement sourcing options to US Buyers . He emphasised the need for India to enhance its competitiveness in areas beyond pricing.
Nath clarified that greater clarity would be achieved after August 12, upon confirmation of duties on Chinese goods. He noted that these duties, which had previously been increased to over 50 per cent before a temporary reduction to 30 per cent, would provide a benchmark. Should duties on Chinese medical devices return to levels exceeding 50 per cent post-August, and should duties on Indian devices by USA are established at 25 per cent, export prospects to the US would likely remain favorable in comparison to China. The ultimate impact of duties on the Indian medical device sector is dependent on relative competitiveness. A duty differential of 15-20 per cent between Chinese and Indian products would favor Indian exports to the USA, potentially incentivising the establishment of production lines within the US. He concluded by pointing out that Indonesia and Vietnam currently benefit from 6 per cent lower duties at 19 per cent , affording them a price advantage, and that the Indian government and manufacturers must work to improve competitiveness to mitigate this 6 per cent disadvantage relative to their Indonesian and Vietnamese counterparts.
India’s Exports to USA were Rs 5667 Cr. in 2024 up by 2 per cent from preceding year and Imports from USA were 12552 Cr. Rs up by 11 per cent from preceding year. USA is the dominant supplier to India of medical devices with the highest market share of 18 per cent followed closely by China at 16 per cent.
The Top 5 Exports to USA Endoscopes, Orthopedic implants, MRI equipment, Urinary Catheters & Electrocardiographs
The top 5 Imports from USA are MRI machine, Orthopaedic Joint implants, IVD Analysers, X Ray Equipment and Cardiac Catheters
Pavan Choudary, Chairman, Medical Technology Association of India, MTaI:
“Donald Trump’s announcement today on Truth Social declaring steep tariffs on India from August 1 is troubling and seems economically shortsighted and strategically misguided.
As a sovereign nation, India makes independent choices in defence and energy based on national interest and long-term strategic priorities. Attempting to punish these decisions through coercive trade measures is not only inappropriate but also counterproductive. Framing a key democratic partner in adversarial terms sends the wrong signal and could jeopardise a relationship built on shared strategic interests and trust.
Stacking India alongside Russia and China, as Trump has done, is an attempt to cast shadows on it before European eyes.
Such mischaracterisation may be coming from a deeper frustration – born of repeated failure to isolate India, despite his numerous public statements aimed at doing so.
It’s worth asking whether the recent clarifications in India’s Parliament by Prime Minister Modi and Foreign Minister Jaishankar – firmly denying Trump’s role in the Indo-Pak ceasefire – have influenced this drastic move. If so, it is unfortunate that straight talk is being met with punitive action.
History, too, offers a sobering lesson. In 1930, the U.S. passed the Smoot-Hawley Tariff Act, slapping steep duties on imports. What followed was catastrophic: U.S. exports fell by 61%, international retaliation ensued, and American farmers and industries suffered immensely. The resulting economic pain deepened the Great Depression and compelled a course reversal through the Reciprocal Trade Agreements Act of 1934 which reduced tariffs and promoted long term trade liberalisation. The USA stayed the flag bearer of this economic doctrine for the next nine decades throughout the world!
Yet, despite the clear historical evidence, protectionist impulses resurface – this time aimed at partners, not a rival. Left unaddressed, such missteps could shift Indo-U.S. ties from cooperation to caution.”