The Trump administration has decided to scrap its plan to impose tariffs on imported generic medicines, bringing major relief to Indian pharmaceutical companies that supply nearly half of all generic prescriptions in the United States.

The move has also reassured millions of Americans who rely on these affordable medicines, mostly made in India, to manage common health conditions such as hypertension, depression, ulcers, and high cholesterol.

India, often described as the “pharmacy to the world,” is the largest source of generic prescription drugs for the US market, far surpassing both American manufacturers and other foreign suppliers. Data from IQVIA, a leading global medical analytics firm, shows that India provides around 47 per cent of all generic prescriptions filled in US pharmacies.

According to the Wall Street Journal, which first reported the decision, the White House’s step marks a major pullback from the Commerce Department’s earlier plan to explore tariffs on pharmaceuticals.

When the investigation was launched in April, the Federal Register had stated that it would cover “both finished generic and non-generic drug products,” as well as the ingredients used to make them.

The reversal followed intense internal debate within Trump’s circle. While hardliners pushed for tariffs to encourage domestic drug manufacturing in the name of national security, members of the President’s Domestic Policy Council reportedly argued that tariffs on generic drugs would only raise medicine prices and create shortages in the US. They also noted that since generics are so inexpensive to produce in countries like India, even steep tariffs would not make manufacturing them in America financially viable.

The broader tariff policy of the Trump administration has already sparked controversy. The trade war with China led to restrictions on rare earth exports and a boycott of US agricultural products like soybeans, devastating American farmers. The government has since announced $16 billion in farm aid, using funds collected through tariffs. Economists say this cost is effectively being passed on to American consumers.

“Essentially, the government is collecting money from us and giving the same right back to us,” a frustrated farmer wrote on social media, where many soy growers have shared stories of loss and anger while being mocked by critics for backing Trump.

Analysts say the White House likely wanted to avoid another unpopular move that could make life harder for Americans. Indian-made generics, according to estimates, saved the US healthcare system about $219 billion in 2022 and around $1.3 trillion over the last decade.

In 2022 alone, Indian companies like Cipla, Sun Pharmaceuticals, and Dr Reddy’s Laboratories supplied more than half of all prescriptions in five of the top ten therapeutic areas in the US. These included treatments for cholesterol, blood pressure, depression, ulcers, and nervous system disorders. Generic versions of medicines like Metformin for diabetes, Atorvastatin for cholesterol, Losartan for hypertension, and antibiotics such as Amoxicillin and Ciprofloxacin are among India’s leading exports to the US.

For now, Americans who depend on these essential medicines can continue to manage their health without facing higher prices, thanks to the decision to hold back on tariffs.