The UK-India FTA tilt the balance in favour of patent owner and undermines access to medicines: experts
Expressing their concerns over provisions in the recently signed agreement that could impact access and affordability of medicines in India, experts noted that certain intellectual property (IP) and regulatory clauses may delay or limit the production of life saving generics, impacting patients in India and across the Global South.
'There is a progressive movement towards accepting the demands of FTA partners, which systematically debasing the public interest safeguards available in the Indian Patents Act,'' warned professor, Centre for Economic Studies and Planning, JNU (Retd), Biswajit Dhar, explaining that the preference on voluntary licenses leaves the access to medicines in the hands of market forces and undermines the role of the government in facilitating access to medicines.
'Often voluntary licenses contain onerous conditions on the licensee and fail to bring sharp price reduction compared to the compulsory licenses,' he said.
He further said that under the Indian Patents Act every year the patent holder must submit details of working of patents in India. The annual submission information will now be submitted once in three years and the confidential information contained in the submission shall not be made available in the public domain.
Added Jyotsna Singh, co-convenor of the working group on Access to Medicines and Treatment: ``This effectively compromises the ability of potential compulsory license applicants to prove unmet demands, which constitute a ground for compulsory license. It clearly tilts the balance heavily in favor of the pharmaceutical transnational corporations allowing them to easily get away by hiding the denial of access to medicines due to high prices on access. '
'There are also provisions in the IP chapter which can potentially undermine the safeguards preventing evergreening of patents,'' said K. M. Gopakumar, co-convenor of Working Group on Access to Medicines and Treatment adding that though couched in best endeavor language there are provisions 'facilitate the sharing and use of search and examination work of the Parties'.
'The implementation of this provision would lead to the harmonization of patentability criteria and undermine safeguards against evergreening such as Section 3 (d) of the Patents Act,'' he said.
Meanwhile, Sanjaya Mariwala, executive chairman and managing director of OmniActive Health Technologies welcoming the move said that India's exports to the UK went up by 12.6% last year, and this deal gives us a chance to build on that growth.
'But it's not just about trade volumes—what stands out is the scope it opens-up in healthcare. With regulatory barriers coming down, Indian healthcare companies will find it easier to operate in the UK, and that can lead to more affordable services and better collaboration between the two systems. That's a space worth watching. At the same time, we can't lose sight of the fact that Free Trade Agreement (FTAs) only work well when businesses at home are strong. As more of these agreements are signed, we need to back our local entrepreneurs and MSMEs with the right support—finance, infrastructure, policy clarity,'' he said.
Adds Bhavin Mukund Mehta, director, Kilitch Drugs: 'The India UK FTA by formalising zero duty access for nearly 99% of Indian pharmaceutical and medical device exports, provides long term clarity and a much needed boost for the Indian pharma industry. With the UK's pharma market projected to grow from about $45 billion now to $73 billion by 2033, and India's generics segment already crossing $910 million in exports in FY 24, this agreement will strengthen India's presence in UK drug stores and broader supply chains. For niche, high quality manufacturers that align with global standards, this is truly a game changer.''
Previously the Commerce Ministry had said that zero tariff provisions under the FTA are expected to significantly enhance the competitiveness of Indian generics in the UK market, which remains India's largest pharmaceutical export destination in Europe.
Currently, India exports $23.31 billion globally and the UK imports nearly $30 billion, but Indian pharma accounts for under $1 billion. The pharma sector has 56 tariff lines, which is just 0.6 per cent of the total, the document stated.
Despite the small representation, the pharmaceutical sector holds high value and strategic importance, especially in global trade, the document added.
India's pharmaceutical industry is the world's third largest by volume and 14th largest in terms of value. The sector's exports rose 10% year-on-year to $30.5 billion in FY 2024-25. The industry is leading in the manufacture of high-quality generic drugs at competitive prices over the last 30 years. India is the largest supplier of generic medicines with a 20 per cent share in the global supply by manufacturing 60,000 different generic brands across 60 therapeutic categories.
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Indian Express
2 hours ago
- Indian Express
Knitwear to apparel, Tamil Nadu's textile belt starts feeling US's 50% tariff heat
IN TIRUPPUR, India's knitwear capital, exporters are already feeling the heat of the 50 per cent tariff US President Donald Trump announced Wednesday. They say orders are being paused, redirected, or lost entirely to competitors like Bangladesh, Pakistan, Vietnam, and Cambodia, all of whom lower US tariffs ranging between 19% and 36%. One Tiruppur exporter told The Indian Express that his regular US shipment had already been diverted to Pakistan. Another said his American buyer asked him to 'hold on' before confirming their summer order. A third revealed that buyers were previously demanding that exporters absorb the 25% tariff hike — a burden that has now doubled overnight. The revised duties, including baseline and remedy-linked tariffs, now push effective rates for some knitted garments to as high as 64%, rendering products up to 35% more expensive than those from regional competitors. What was initially seen as a major setback is now viewed by exporters as 'a de facto trade embargo'. The blow comes at a particularly cruel time when Tamil Nadu's textile belt was preparing for a rebound in US orders. Tiruppur, Coimbatore, and Karur collectively employ over 1.25 million workers and export Rs 45,000 crore worth of garments annually. Just weeks ago, optimism surged on the back of the India–UK Free Trade Agreement (FTA) and growing US interest in Indian goods due to elevated tariffs on China (125%-145%) and Myanmar (40%). Many exporters in Tamil Nadu had invested in new machinery to meet the expected surge. That hope is now turning into despair under the weight of retaliatory tariffs, especially with respect to China, which is now at 30% and could see a further downward revision once Beijing inks a deal with Washington DC. 'This is a setback,' said K M Subramanian, president of the Tiruppur Exporters' Association (TEA). 'Standalone exporting companies will be hit first. Buyers are already asking us to absorb part of the tariff. Our margins are just 5% to 7%; how can we share this cost?' Subramanian said while 30% of Tiruppur's exports go to the US, a diverse buyer base in Europe and the Middle East may provide some cushion – but not without pain. 'The non-branded buyers will shift immediately. Branded ones may stay because of the social compliance and operating protocols we offer, but we will still bleed for some time.' Textiles is a labour-intensive sector, and there are worries of job losses if the market shrinks. If exports contract 10-20% due to loss of orders, it can threaten 100,000–200,000 textile and garment jobs collectively in the three hubs — Tiruppur, Karur and Coimbatore — over the next few months. Tiruppur alone contributes Rs 40,000 crore to knitwear exports, supplying global giants like Walmart, GAP, and Costco, and accounting for 55% of the country's knitwear exports. The region had hoped to expand it by 10–15% in FY2025–26. Now, the outlook is grim, with analysts forecasting a 40–50% fall in US-bound orders, especially in cotton and knitted apparel segments. The fallout is not confined to garments alone. In Coimbatore and Karur, known for home textiles, order stagnation has already begun. K Selvaraju, secretary general of the Southern India Mills' Association, said buyers have started deferring or holding off on their summer bookings for bed linens and towels – key products traditionally finalised by October. 'We're hearing 'hold on' from clients who had placed advance enquiries,' Selvaraju said. 'If we miss this window, we miss the season.' Karur alone exports nearly Rs 9,000 crore in home textiles each year, with Rs 6,900 crore going as direct exports. Coimbatore mills send large volumes of cotton towels and kitchen linens to the US – now burdened with higher duties. 'This isn't just about one tariff hike – its compounding an already weak environment,' Selvaraju said, pointing to India's 11% import duty on cotton and a GST duty inversion that further hurts competitiveness. 'Polyester raw material is taxed at 18%, yarn at 12%, but finished garments are taxed at 5%. This adds 6-7% to export costs, while competitors don't have such inverted duties.' Meanwhile, the quality of cotton imports from Brazil, which make up 45% of this year's inbound shipments, is under scrutiny for not always meeting US-mandated standards. Selvaraju has urged the Centre to negotiate a cotton-forward deal, offering duty-free access to US cotton in exchange for apparel exports made from it. The global textiles market is highly competitive; India's key rivals face no such punitive hikes. Bangladesh continues with an effective rate of 35–36%, Pakistan has successfully negotiated a 19% tariff, Vietnam is at 20–21%, and Cambodia, though previously at 49%, now enjoys a 19% rate after an August 1 revision. By comparison, India's 50% penalty rate is not only isolated but unprecedented. One Tiruppur manufacturer admitted his shipment was lost to Pakistan. 'They seem to have offered a better price,' he said. 'The order slipped.' Subramanian reiterated that Bangladesh remains India's fiercest rival in the US market. 'Their 20% rate means they're much cheaper, significant when your margin is about 5%.' This margin has now all but vanished. With total duties touching 64%, non-branded US buyers are already shifting to cheaper options. 'They shift overnight,' Subramanian warned. Industry leaders are urging for immediate policy relief. 'The government had then provided an extended credit guarantee-linked scheme,' Selvaraju recalled, referring to pandemic-era support. 'It's time to bring that back.' He also pressed for eliminating the 11% cotton import duty and restructuring the GST regime on manmade fibres. 'For our exports to remain viable, tax on all raw materials must be below 5%.' If ignored, the consequences will be stark. Indian suppliers could lose permanent ground to Bangladesh, Cambodia as well as Vietnam and Pakistan – all of whom now enjoy cheaper landed prices in the US. The ripple effect – order shrinkage, idle capacity, and job losses – is already underway. 'The US market still wants to buy from us,' Selvaraju said. 'They like Indian cotton, the Indian make. But political and policy hurdles are pushing them away.' Ramdas, a mid-sized factory owner in Tiruppur, said the next two to three weeks will be decisive. 'We haven't seen cancellations yet, but the tone is changing. Everyone's cautious.' Yet, there is cautious hope. Subramanian believes this downturn could still be survived if India moves quickly. 'We got through Covid. We will get through this,' he said. 'We are talking to the Central government. We are urging negotiations with the US.' Some exporters also hope that pressure from big American brands – worried about higher retail prices – might eventually force a rethink in Washington.
The Hindu
3 hours ago
- The Hindu
Will India cave in to U.S. pressure on Russian oil?
The story so far: On August 6, U.S. President Donald Trump announced a whopping 25% penalty tariff on Indian goods for India's import of Russian oil. This was on top of the 25% reciprocal tariffs announced on July 31 after Indian and U.S. negotiators failed to reach a Free Trade Agreement (FTA). How has India responded to the tariffs? India has so far not announced any overt action against the U.S. for its tariffs. The 25% reciprocal tariffs went into effect on August 7, and the impact will unfold in the upcoming weeks. Already, reports suggest garment exporters are facing trouble with U.S. importers suspending orders, given that U.S. tariffs on Asian competitors in Vietnam, Pakistan, Bangladesh and Sri Lanka are much lower. Mr. Trump's penalty tariffs, meanwhile, will go into effect on August 27, and New Delhi is hopeful that there will be some change in position. As a result, India's response has been carried in three statements. On August 4, the Ministry of External Affairs (MEA) issued a release criticising both the U.S. and the European Union for 'targeting' India over Russian oil imports, pointing out that they both continue to trade with Russia. While the U.S. procures critical minerals, chemicals and nuclear trade components, the EU countries continue to buy oil and LNG from Russia. On August 6, the MEA called the U.S. actions 'extremely unfortunate' and 'unfair, unjustified and unreasonable', vowing to protect India's national interests. On August 7, Prime Minister Modi said that he was ready to pay a price 'personally' to protect the interests of India's farmers, fishermen and livestock, and dairy keepers. This was an indication that India-U.S. trade talks had broken down over market access to the agricultural sector. Between giving in on market access or giving up Russian oil, India appears to be facing two 'impossible' choices. Can the tariffs be stopped? Mr. Trump has announced that he will meet Russian President Vladimir Putin on August 15 in Alaska, which incidentally will be the first Putin trip to the U.S. since 2015 when he travelled to the UN for a summit. According to reports, Mr. Putin has offered to stop the war in exchange for keeping territories the Russian forces control, but it is unclear if this would be acceptable to Ukraine and European countries. If there is a deal, India may receive a roll back of the Russian oil penalties, and the MEA issued a statement Saturday welcoming and 'endorsing' plans for the Trump-Putin Summit. In his executive order of August 6, Mr. Trump has given himself 'modification authority', if Russia were to 'take significant steps' to end the Ukraine war and security threats to the U.S. In addition, a U.S. team of FTA negotiators are scheduled to visit Delhi on August 25. If India makes certain concessions on trade and market access, a mini-trade deal could go a long way in reducing the U.S. tariffs. How much Russian oil does India procure? Prior to Russia's invasion of Ukraine in February 2022, India imported very little oil from Russia. Ural oil, considered 'heavy' crude and priced too high as Russia had European buyers, consisted only 1% of India's basket of sellers. After the EU began to sanction Russia, and committed to zeroing out all energy purchases from Russia, the price of Ural dropped, and India, as well as China and others, began to pick up more Russian oil. By May 2023, India was importing two million plus barrels of Russian crude per day (bpd), making up between 35-40% of India's basket. Russia has been its largest supplier since. However, India-Russia energy ties go beyond this trade. After the Modi-Putin summit in Sochi in May 2018, and Mr. Putin's visit to India for the annual summit that year, the India-Russia joint statement recorded investments of over $5 billion by an Indian consortium of PSUs in Vankorneft and Taas-Yuryakh Neftegazodobycha in Russia. Russian oil major Rosneft picked up a 49% stake in Essar Oil for $12.9 billion. The new entity was renamed Nayara Energy, and it included Essar's Vadinar refinery in Gujarat — 49% stake went to a consortium, and Essar retained 2%. Vadinar refinery, along with other private refiners like Reliance, began to reprocess Russian oil and export it to other countries over the next few years. Mr. Trump called this, 'selling it on the open markets for big profits'. None of this violated any sanctions, and despite requests from Western countries, the government continued to purchase oil from Russia, saving India about $13 billion by 2024 and a further $3.8 billion in 2025, according to estimates by the ICRA. Experts say it will be difficult for the government to give in to U.S. pressure this time, economically as well as politically and diplomatically. The Indian government would lose face domestically, and risk damaging ties with an all-important friend, Russia. For the moment, Kpler reports that the price of Ural has dropped after demand has reduced from Indian companies, but experts say it is unlikely to completely stop Russian imports, even as India broadens its non-Russian intake through the U.S., Iraq, Kuwait, UAE and Saudi Arabia. What happened with oil imports from Iran? India's refusal to stop importing Russian oil was a shift from 2018, when Mr. Trump had demanded India's compliance in 'zeroing out' oil from Iran and Venezuela. After initially maintaining that India would not bow to such diktats, the government caved in by May 2019, and stopped all its direct oil purchases from both Iran and Venezuela, incurring heavy losses, as the oil was both 'sweet' for its refineries and priced competitively. What does this mean for foreign policy? Since 1999, after the U.S. placed sanctions on India for nuclear tests, Delhi and Washington have worked tirelessly to change relations between them. They have built trust for a quarter of a century through a civil nuclear deal, military and defence cooperation, counter-terror cooperation, technology partnerships and the Quad grouping in the Indo-Pacific. Experts in both countries say that besides hurting Indian trade, Mr. Trump's actions will damage the India-U.S. relationship in several other areas. At the same time, Delhi's moves to shore up strategic autonomy and independence are significant. National Security Adviser Ajit Doval travelled to Moscow last week to prepare for Mr. Putin's visit to India, and External Affairs Minister S. Jaishankar is expected to follow later in the month. Mr. Modi will travel to Japan and then to China for the Shanghai Cooperation Organisation (SCO) summit and a bilateral meeting with President Xi Jinping, on his first such visit since the 2020 LAC (Line of Actual Control) military clashes. Moreover, Delhi is due to host the Quad summit this November, and much will depend on whether Mr. Modi and Mr. Trump can restore ties by then.
Time of India
7 hours ago
- Time of India
Trump's 50% tariff shock jolts Punjab industry
Ludhiana: The slapping of an additional 25% penalty by US president Donald Trump after the already steep 25% reciprocal tariffs have come as a huge setback to Indian exporters. Industry stakeholders, especially in textile-dominant cities like Ludhiana, are sounding the alarm over financial and job losses and the pressing need for govt relief and swift finalisation of Free Trade Agreements (FTAs) with other countries. "This is not just a dent to our profits — it's a death knell for our competitiveness and survival," Amit Thapar, president of Ganga Acrowools and chairman of the CII Northern Region Export Promotion Committee, said. "Even if the 25% penalty linked to Russian oil imports is removed, the reciprocal 25% tariff itself is extremely high. It will choke exporters," he warned. India's textile exports to the US form a critical portion of the country's overall outbound trade. Of the $35 billion annual textile exports from India, nearly 28% goes to the US, making it a prominent destination. The textile-rich cities of Ludhiana, Tiruppur, Panipat, Surat, Bikaner and Coimbatore stand on precarious ground. "The trust that has been built over decades with American customers is now being shaken. Some orders have already been withheld. Our clients are upset but they simply cannot pay higher prices compared to competitors from countries unaffected by these tariffs," Thapar said. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Cingcin: Unsold Sofas Prices May Surprise You (Prices May Surprise You) Sofas | Search Ads Search Now Undo He added that segments like gems and jewellery, electronics, automotive components, and petroleum likely to suffer in the crossfire of this trade policy. "It is ironical that even raw materials that are not made in the US are being penalised. The policy feels more like a punishment for them as well as they are also worried that their supply chains would be disrupted," Thapar said. The industry is urgently demanding a relief package to offset immediate damages. "Even if the govt cannot protect our profits, we at least need support to ensure we don't slip into losses or have to lay off workers," Thapar said, adding, "If timely assistance is not provided, there's a real danger of job losses across cities like Ludhiana and other cities and towns that are textile hubs." Echoing similar concerns, Amit Jain, president of CII Punjab, said, "We hope a solution is found by Sept-end. But if not, we must be prepared for the worst. Exporters need to actively look for alternatives." He urged spinners and manufacturers to explore different product lines, such as newer types of yarns, technical textiles and diversify their customer base. "The govt must fast-track its FTA negotiations. The India-EU FTA must be concluded quickly. The UK FTA should be operationalised without delays. Markets like Canada, Brazil, also hold significant promise, and we need FTAs with them urgently," Jain said. One of the gravest concerns among industry leaders is the impact on employment. Thapar said, "The textile sector is particularly vulnerable. These are the units that provide the bulk of employment in textile and garment hubs. Losing orders from the US could mean job losses for thousands of workers." Stating that it takes years to establish credibility and compliance in a new export destination. Thapar said, "Finding alternate markets is easier said than done. The Indian govt must act—both by pushing international negotiations and rolling out domestic support." BOX DOUBLE WHAMMY DEALS A BLOW INTRO: Industry stakeholders across India, especially in textile-dominant cities like Ludhiana are sounding the alarm over financial and job losses, and the pressing need for govt relief and swift finalisation of Free Trade Agreements (FTAs) with other countries QUOTES This is not just a dent to our profits — it's a death knell for our competitiveness and survival. The trust that has been built with American customers over decades is now being shaken. Some orders have already been withheld. Our clients are upset, but they simply cannot pay higher prices compared to competitors from countries unaffected by these tariffs Amit Thapar, president of Ganga Acrowools and chairman of CII Northern Region Export Promotion Committee We hope a solution is found by Sept-end. But if not, we must be prepared for the worst. Exporters need to actively look for alternatives. The govt must fast-track its FTA negotiations. The India-EU FTA must be concluded quickly. The UK FTA should be operationalised without delays. Markets like Canada, Brazil, also hold significant promise, and we need FTAs with them urgently Amit Jain, president of CII Punjab Stay updated with the latest local news from your city on Times of India (TOI). Check upcoming bank holidays , public holidays , and current gold rates and silver prices in your area. Get the latest lifestyle updates on Times of India, along with Raksha Bandhan wishes , messages and quotes !
