Why in news?
India’s pharmaceutical industry supplies a large share of the world’s generic medicines. In September 2025 policymakers called for using this strength as a diplomatic tool. As countries negotiate trade agreements and seek affordable medicines, India’s generics have emerged as a global public good.
India’s pharmaceutical landscape
India is often called “the pharmacy of the world”. Generic drugs made here account for a significant portion of medications sold in the United States, Europe and Africa. Indian companies specialise in producing off‑patent medicines at low cost. These exports support domestic employment and contribute billions of dollars in foreign exchange.
Why generics matter
- Affordable healthcare: Generics drive down prices for patients and governments, especially in low‑ and middle‑income countries. They have enabled large‑scale treatments for HIV/AIDS, tuberculosis and malaria.
- Public health diplomacy: Supplying medicines strengthens India’s relations with developing countries. During the COVID‑19 pandemic India provided vaccines and drugs to neighbours and Africa.
- Strategic leverage: In trade negotiations, India can use access to affordable medicines as a bargaining chip to secure favourable terms in other sectors.
Challenges and opportunities
- Protectionist barriers: Some countries impose regulatory hurdles or tariffs that restrict imports. Intellectual property regimes and patent extensions can limit generic entry.
- Quality standards: Ensuring consistent quality and complying with diverse regulatory standards is critical to maintain trust.
- Domestic capacity: India needs to invest in research and manufacturing infrastructure, upgrade compliance with Good Manufacturing Practices and prevent supply disruptions.
Way forward
- Leverage international negotiations under World Trade Organisation rules to preserve the flexibility of compulsory licensing and parallel imports.
- Diversify export markets by engaging with Africa, Latin America and Southeast Asia, reducing over‑dependence on the U.S. market.
- Promote joint ventures and partnerships with local firms abroad to overcome regulatory barriers and strengthen supply chains.
- Invest in domestic R&D, biotechnology and digital health to stay competitive as the world shifts toward personalised medicines.