What India–EU FTA Means for Pharma, Medical Devices Exporters

The Department of Pharmaceuticals of India’s Ministry of Chemicals and Fertilizers on Tuesday said the India–EU free trade agreement (FTA) will open access to the EU’s $572.3 billion pharmaceuticals and medical devices market for Indian companies. However, some industry players fear that despite the deal, Indian firms will continue to face heavy regulation in the European market.

The so-called “mother of all deals” lowers import tariffs on European pharma exports from 11% to zero and also eliminates tariffs on Indian medical instruments, appliances and vital supplies, which earlier stood at 6.7%.

What It means of Indian Cos

“Liberalised tariffs for Indian medical devices will accelerate growth in this high-value sector,” Union Minister for Chemicals and Fertilisers J P Nadda said on Tuesday.

However, a pharma industry executive told Outlook Business that the EU remains a highly regulated market and “success will ultimately depend on companies’ ability to consistently meet its stringent quality and compliance standards.”

“Many companies, including ours, are already well-versed in these requirements, having supplied to the EU for years, and several others are well positioned to capitalise on this opportunity,” the person said on condition of anonymity.

The EU’s regulatory standards, enforced by the European Medicines Agency (EMA), are considered among the toughest in the world. It was earlier reported that one of the key sticking points in the trade talks was the bloc’s demand to keep stringent Trade-Related Aspects of Intellectual Property Rights (TRIPS) provisions in place, including stricter enforcement, longer data exclusivity for pharmaceuticals and tighter patent norms. India has been demanding the intellectual property flexibilities allowed under the WTO’s TRIPS agreement, which enable faster entry of generic medicines and support affordable healthcare.

“The India–EU Free Trade Agreement is a strategic opportunity for Indian pharmaceutical companies, but it also raises the bar on execution,” said Parag Bhatia, Director, Laborate Pharmaceuticals, adding that the real impact will depend on how well Indian manufacturers align with Europe’s stringent regulatory, quality and documentation standards.

Europe accounted for about 19–21% of India’s pharmaceutical exports, valued at around $5.8 billion in FY25, according to commerce ministry data. Generic formulations and biosimilars made up 75–80% of these exports, followed by bulk drugs (APIs) and vaccines.

“The EU market places a strong emphasis on consistency, traceability and pharmacovigilance, not just during inspections but across the entire product lifecycle. For Indian pharma exporters, this agreement reinforces the need to strengthen manufacturing discipline, invest in quality systems and adopt a long-term compliance mindset,” Bhatia added.

According to Sheetal Arora, Promoter and CEO, Mankind Pharma Ltd, this agreement opens a significant opportunity for Indian pharmaceutical companies.

“It allows Indian manufacturers of APIs and generics to expand their presence in the European market and reduce over-dependence on the US. Overall, it is a balanced and forward-looking agreement that benefits patients, strengthens healthcare access, and supports the long-term growth of the Indian pharmaceutical industry,” he added.

Indian Market Open for Europe

The FTA also gives European firms easier access to India’s high-end medical devices market by removing tariffs on most EU pharmaceutical products and about 90% of optical, medical and surgical equipment. Duties of up to 11% on EU drugs will be largely eliminated, lowering the cost of advanced medical equipment and boosting trade.

The deal is also expected to spur European investment in India’s research-based pharma sector.

“Many medicines imported from Europe are advanced, niche and patented therapies used in the treatment of cancer and rare diseases. Reducing tariffs from 11% to zero will make these critical medicines more affordable and accessible for Indian patients who need them the most,” said Arora.

Saurav Ojha, Co-Founder and Whole-Time Director of Gurugram-based Iberia Pharmaceuticals, agrees.

“Reduced import duties, easier regulatory pathways and deeper technology collaboration can significantly lower the cost of advanced therapies for Indian patients. In the short term, we anticipate a mild price reduction of 10–20%, but the real impact will unfold over the next two to three years, with prices potentially dropping by 40–70% once local manufacturing scales up, biosimilars enter the market and patent expiries align,” Ojha said.

He added that the trade deal could enable faster entry of biosimilars and generics, encourage local manufacturing and reduce dependence on imports, which has historically kept these drugs expensive and out of reach.

Fears of Market Flooding

The industry executive cited earlier warned that the agreement could also open up the domestic market to aggressive imports.

Similar concerns are being echoed by the medical devices industry, which already sees around 80% imports in India. “Opening medical device imports might be helpful in a few cases. However, flooding of the market by second-hand, pre-used devices is a reality,” Dr Vinay Aggarwal, former national president of the Indian Medical Association (IMA), told Indian Express.

He added that India imports 70–90% of its medical devices, many of which are not covered by domestic regulation despite EU certifications. Only 23 devices are regulated under the Drugs and Cosmetics Act, leaving most implantable devices unregulated and raising patient safety concerns. He argued that a standalone medical devices law is urgently needed and warned that the EU deal could slow domestic manufacturing, while urging India to stick to its existing patent regime.

While a section of the Indian pharma and medical devices industry is cheering the India–EU FTA after decades of negotiation, others are sounding the alarm over its potential impact on the ground. The real effects will become clear only once the deal is ratified by both sides and implemented.