India's pharmaceutical exports demonstrated resilience in the current financial year, crossing $28.29 billion during April-February FY26, according to Outlook Business and The Hindu BusinessLine. This represents a 5.6% increase compared to the same period in FY25, marking the sector's ability to maintain growth momentum despite global headwinds. As reported by Outlook Business, K Raja Bhanu, Director General of the Pharmaceuticals Export Promotion Council of India (Pharmexcil), highlighted that exports reached $30.47 billion in FY2024-25, recording a 9.4% year-on-year growth despite global pricing pressures and trade volatility. The growth was primarily driven by formulations, biologicals, vaccines, and AYUSH products, with officials noting that growth has been driven primarily by high-value segments such as formulations, biologicals and vaccines, along with increasing demand for Ayush products. Commerce Secretary Rajesh Agrawal noted that while export targets appear difficult to meet in dollar terms due to the weakening rupee, the sector is likely to stay on a positive trajectory.
The Indian pharmaceutical sector currently ranks third globally in pharmaceutical production by volume, with shipments reaching more than 200 markets, as reported by The Hindu BusinessLine and ThePrint. Over 60% of India's pharma exports go to highly regulated markets, highlighting the sector's quality and compliance standards. The United States accounts for 34% of India's pharmaceutical exports, followed by Europe at 19%, according to industry data cited in the reports. Industry experts noted that India's cost competitiveness, strong manufacturing capabilities and established presence in generic drug markets have played a crucial role in supporting exports, with the country continuing to supply essential medicines to both developed and developing markets, reinforcing its role in global healthcare supply chains. Commerce Secretary Rajesh Agrawal emphasized the need for the pharmaceutical industry to reduce supply chain dependencies and sharpen its focus on diversifying export markets, with the government prioritizing pharmaceutical sector as one of the key areas for supply chain resilience.
The West Asia war's impact on March performance has created significant challenges for FY26 pharma exports, with Commerce Secretary Rajesh Agrawal warning that if the conflict continues, India's exports to other parts of the world will also be impacted. Speaking at a press conference on the sidelines of 'Chintan Shivir - Scaling Up Pharma Exports', Agrawal revealed that 12-13% of Indian exports go directly to West Asia, making the region crucial for the pharmaceutical sector. The crisis has already impacted both imports and exports, as energy constitutes a major part of India's import market, with the government engaged in prioritizing limited LPG supplies and exploring alternative sourcing options. Pharmexcil Chairman Namit Joshi had earlier warned that freight disruptions could result in $500 million loss in March exports, though officials remain cautiously optimistic about final results. The record $30.47 billion exports in FY25 were partially aided by exporters invoicing $1.6 billion medication to the US in March ahead of new, higher tariff regime implementation, which was much above normal sourcing levels and influenced 2025-26 numbers significantly.
Industry leaders project significant expansion for the pharmaceutical sector, with the Indian pharmaceutical sector currently valued at around $60 billion expected to grow to $130 billion by 2030, as reported by The Hindu BusinessLine and ThePrint. Pharmexcil is targeting $65 billion in exports by 2030, backed by policy prioritisation, diversification beyond traditional markets, higher FDI inflows and faster regulatory clearances. The long-term outlook for the sector remains robust, with this expansion expected to be supported by increasing global demand, innovation in biologics and vaccines, and a growing domestic market. Bhanu emphasized that Pharmexcil aims to achieve this growth through policy prioritisation, market diversification beyond traditional geographies, increased FDI inflows and improved regulatory efficiency. Despite challenges, Commerce Secretary Rajesh Agrawal said the sector is likely to land up better than last year, with the government slashing import duties recently as a facilitation measure for companies to purchase from other geographies.
The external environment, especially in the US market, could become a key variable for future outlook. The US has announced a fresh tariff framework targeting patented drugs and certain high-value pharmaceutical ingredients manufactured outside America, with duties of up to 100% set to take effect between August and September 2026 after a transition period. However, the near-term impact may be limited as generic medicines are currently exempt, and about 90% of India's pharmaceutical exports to the US are generics, according to a GTRI report cited in The Hindu BusinessLine. Joshi noted that tariff-related issues in 2025 led to higher procurement of medicines worth $1.6 billion in the US, above normal levels, which is expected to influence FY26 numbers. Despite these challenges, Pharmexcil Chairman Namit Joshi said India is likely to end the current financial year at levels similar to FY25, with some growth coming from the higher US procurement levels. The government's recent import duty reductions are specifically aimed at helping companies source from alternative geographies to mitigate tariff impacts.
