Widely regarded as the “Pharmacy of the World,” India has built its reputation on delivering a unique combination of affordable pricing and assured quality medicines, the government said. The industry ranks third globally by volume and eleventh by value, supported by over 3,000 companies and 10,500 manufacturing units. In FY25, the sector recorded an annual turnover of Rs 4.72 lakh crore, while exports have grown at a compound annual growth rate of 7 per cent over the past decade. India currently supplies around 20 per cent of the world’s generic medicines, spanning nearly 60,000 brands across 60 therapeutic categories.
“By expanding access to affordable HIV treatment and emerging as a leading global supplier of cost-effective vaccines, the pharmaceutical industry continues to advance public health outcomes domestically and internationally while generating economic opportunities,” the government said.
India hosts the highest number of United States Food and Drug Administration (USFDA)-approved plants outside the United States and accounts for nearly 8 per cent of the global active pharmaceutical ingredient (API) industry with about 500 manufacturers. This has reinforced international confidence in the quality and safety of Indian drugs, according to the government.
Pharmaceutical Exports
Exports remain a key growth driver, with pharmaceutical shipments reaching USD 30.5 billion in 2024–25, marking a nearly 16-fold increase from USD 1.9 billion in 2000–01. Indian medicines are now exported to 191 countries, with about half directed towards highly regulated markets such as the United States and Europe. The country is also a global leader in vaccine supply, contributing 60 per cent of UNICEF’s vaccine requirements and meeting a substantial share of global demand for DPT, BCG, and measles vaccines.
“Export momentum has also remained strong every month, with Drugs and Pharmaceuticals exports rising by approximately 2.70 per cent from USD 2.59 billion in January 2025 to USD 2.66 billion in January 2026. Further, medical device exports have grown significantly from USD 2.5 billion in 2020-21 to USD 4.1 billion in 2024-25, with exports to 187 countries in FY25,” the official release added.
“India’s pharmaceutical sector has expanded its global presence through rising exports and steady foreign investment, signalling strong international confidence in its manufacturing and regulatory standards. Collectively, these strengths position India as a dependable supplier of quality, affordable medicines and underpin its continued export-driven growth,” it said.
The government further noted that Indian pharmaceutical exporters have strategically diversified their export portfolio by expanding shipments to emerging and non-traditional destinations, including Nigeria, Mexico, the United Republic of Tanzania, the Netherlands, France, Brazil, Sri Lanka, Saudi Arabia, and Spain, across bulk drugs, surgical products, and formulations. This targeted market diversification has enhanced export resilience by mitigating exposure to tariff-related risks concentrated in individual markets.
Foreign Direct Investment
At the same time, rising foreign direct investment—amounting to Rs 13,193 crore in FY26 (up to September)—reflects growing global confidence in India’s pharmaceutical manufacturing ecosystem.
Trade Agreements
Trade agreements are expected to further accelerate growth. Recently concluded pacts with the European Union, the United Kingdom, and New Zealand aim to enhance market access, reduce tariffs, and boost the competitiveness of Indian pharmaceuticals and medical devices. These agreements are likely to drive exports, create employment, and deepen India’s integration into global healthcare value chains.
India-EU FTA
“India and the European Union have concluded negotiations for a Free Trade Agreement that significantly expands opportunities for the Indian pharmaceuticals and medical devices sectors. The agreement provides enhanced market access to the EU, valued at approximately USD 572.3 billion, encompassing pharmaceutical products and medical technologies. Tariff liberalisation is expected to improve the global competitiveness of Indian medical devices, while established manufacturing hubs in Maharashtra, Gujarat, Telangana, Karnataka, and Andhra Pradesh are likely to experience export expansion. The agreement is further anticipated to stimulate skilled employment, strengthen Micro, Small, and Medium Enterprise (MSME) participation, and deepen India’s integration into global healthcare value chains,” the government said.
India-UK CETA
The India-UK Comprehensive Economic and Trade Agreement (CETA), signed in July 2025, creates new opportunities for India’s pharmaceutical and medical devices sectors. Under the agreement, 56 pharmaceutical tariff lines will receive zero-duty market access, making Indian generic medicines more competitive in the UK, which remains India’s largest pharmaceutical export market in Europe.
The agreement also provides duty-free access for several medical devices, including surgical instruments, diagnostic equipment, ECG machines, and X-ray systems. This is expected to reduce costs for Indian manufacturers and strengthen their competitiveness in the UK market, the government said.
India-NZ FTA
The government stated that the India-New Zealand Free Trade Agreement, concluded in December 2025, expands opportunities for Indian pharmaceutical exports by providing zero-duty access to pharmaceutical products across around 90 tariff lines, where earlier duties were high as upto 5 percent.
Production Linked Incentive (PLI) Schemes
The government said its initiatives continue to play a crucial role in shaping the sector’s trajectory. Production Linked Incentive (PLI) schemes have boosted domestic manufacturing, reduced import dependence, and generated employment. Investments under the PLI scheme for pharmaceuticals have exceeded targets, while bulk drug and medical device parks are strengthening infrastructure and supply chains.
“These schemes have already resulted in the avoidance of imports worth Rs. 3,591 crore of active pharmaceutical ingredients (APIs), key starting materials (KSMs), and drug intermediates (DIs) under PLI schemes for pharmaceuticals and bulk drugs, thereby contributing to a measurable reduction in import dependency and strengthening India’s manufacturing resilience,” the government highlighted.
PLI Scheme for Pharmaceuticals
According to the government, the scheme supports domestic manufacturing of high-value biopharmaceutical products, complex generics, and autoimmune drugs, contributing to significant sales, exports, and employment generation. The investment under the scheme stands at Rs 40,890 crore against a target of Rs 17,274.96 crore as of September 2025.
Since its inception in 2021:
- Total sales have reached Rs 3,16,797 crore up to September 2025.
- Exports account for Rs 2,03,730 crore within these total sales.
- Approximately 97,000 persons, including contractual and apprentice workers, have been employed under the scheme as of September 2025.
The PLI Scheme for Bulk Drugs (APIs/KSMs/DIs) aims to ensure a steady supply of critical inputs and reduce reliance on single sources. The government highlighted that investments mobilised under the scheme stand at Rs 4,763.34 crore against a target of Rs 4,329.95 crore, with employment generated for 4,929 persons.
Schemes for Infrastructure Development for Bulk Drug and Medical Devices
Scheme for Promotion of Bulk Drug Parks
The government also highlighted that the Scheme for Promotion of Bulk Drug Parks supports the development of a common infrastructure for bulk drug manufacturing. Under the scheme, three bulk drug parks have been approved and are at various stages of development in the States of Andhra Pradesh, Gujarat, and Himachal Pradesh, through their respective State implementing agencies. As of February 2026, the total project cost of these parks is over Rs 6,306.68 crore, with Central assistance to the tune of Rs 1,000 crore each for creation of common infrastructure facilities (budgetary outlay of Rs 3,000 crore).
Scheme for Promotion of Medical Devices Parks
This scheme aims to provide common testing and laboratory facilities at a single location, significantly reducing manufacturing costs and helping create a robust ecosystem for medical device manufacturing. Under this scheme, three parks are being set up and are at an advanced stage of development in Uttar Pradesh (Greater Noida), Madhya Pradesh (Ujjain), and Tamil Nadu (Kanchipuram). The total project cost of these Parks is Rs 871.11 crore, with a Central grant-in-aid of Rs 100 crore each for the creation of common infrastructure facilities. As of December 2025, 199 medical device manufacturers have been allotted land across the three parks, a total of 306.64 acres, and 34 units have commenced construction of their plants.
Research and Innovation
In parallel, innovation-focused programmes such as the Promotion of Research and Innovation in Pharma MedTech (PRIP) scheme are fostering collaboration between industry and academia. The proposed Biopharma SHAKTI initiative, with an outlay of Rs 10,000 crore over the next five years, aims to position India as a global hub for biologics and biosimilars, further advancing research and clinical capabilities.
Access to Affordable Medicines
Efforts to improve affordability and access have also gained momentum. The Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP) has expanded significantly, with over 18,600 outlets providing low-cost medicines and generating substantial savings for citizens.
The scheme aims to improve access to affordable, quality generic medicines across the country by reducing out-of-pocket expenditure and ensuring the availability of essential drugs and medical devices at reasonable prices.
- Under the scheme, as of March 2026, over 18,646 Jan Aushadhi Kendras (JAKs) as of February 28, 2026 are operational, the government noted.
- The product basket comprises 2,110 medicines, 315 medical devices, and consumables covering 29 therapeutic groups.
- Jan Aushadhi Suvidha Sanitary Napkins are available at Rs 1 per pad, with over 100 crore pads sold till January 31, 2026.
- Out of this, over 22.50 crore Jan Aushadhi Suvidha Sanitary Pads have been sold in the FY 2025-26 till January 31, 2026.
- In 2024-25, sales of Rs 2,022.47 crore resulted in estimated savings of about Rs 8,000 crore for citizens.
- In 2025-26, up to November 30, 2025, sales of Rs 1,409.32 crore have led to savings of approximately Rs 5,637 crore for citizens.
The government stated that these initiatives collectively demonstrate a coordinated policy approach to strengthening domestic manufacturing, promoting innovation, improving affordability, and enhancing global competitiveness across the pharmaceutical and MedTech sectors.
The government reiterated that India’s pharmaceutical sector operates within a strong regulatory framework, led by institutions such as the Central Drugs Standard Control Organisation (CDSCO) and the National Pharmaceutical Pricing Authority (NPPA), ensuring quality, safety, and price control. The Indian Pharmacopoeia Commission further standardises drug quality, with recognition across multiple countries.
Expanding exports, supportive policies, and increasing global integration are expected to drive the sector toward its USD 130 billion milestone by the end of the decade.
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