With the India–EU free trade agreement now signed, attention is turning to a familiar public question: will patients actually see cheaper medicines and lower medical bills? While the deal proposes to remove tariffs on medicines, medical devices and critical inputs, experts warn that the effect on patient-level spending will depend on how cost savings flow through manufacturing, regulation and pricing mechanisms.
The agreement is expected to transform trade across pharmaceuticals, medical devices and healthcare services, sectors where both India and the EU are major global players. The EU is a key export destination for Indian drugs, while India relies heavily on Europe for high-end machinery, medical devices and specialised inputs used in healthcare manufacturing.
Why drug prices may not fall overnight?
Despite the prospect of tariff cuts, experts warn against expecting instant relief at the pharmacy counters. In India, medicine prices are influenced by multiple layers such as government price controls, formulation and packaging costs, distribution margins and the maximum retail price (MRP) system.
Rajiv Nath, Forum Coordinator at the Association of Indian Medical Device Industry (AiMeD) said that tariff reductions alone do not automatically translate into lower consumer prices. He pointed out that any benefit will reach patients only if it is reflected in MRPs as import duties form just one component of overall healthcare costs.
Nath says the larger opportunity lies in creating fair and transparent regulatory alignment under the FTA, particularly for medical devices. According to him, safeguarding the domestic industry against distortions while aligning standards could strengthen India’s manufacturing base, rather than merely opening the market to imports.
This view aligns with broader concerns that without appropriate checks, cheaper imports may benefit institutions and suppliers more than patients at least in the short term.
Sanjaya Mariwala, Executive Chairman and Managing Director of OmniActive Health Technologies Ltd said that the India–EU FTA is a structural healthcare enabler not an overnight price-cut mechanism. “By unlocking access to the $572.3 billion EU health market, it strengthens India’s broader life sciences value chain, including nutraceuticals. In production-linked segments, particularly nutraceutical ingredients and formulations, tariff elimination in select categories could lower input costs, but the pass-through to consumers depends on implementation timelines. However, until tariff rationalisation is fully notified and HSN code classifications are formally aligned, procedural and cost frictions for nutraceutical trade will persist,” he said
“Processes at the designated regulatory authority level have progressed slower than industry expectations. In parallel, lower duties on imported medical equipment and specialised processing machinery can reduce system-level costs, supporting scale, higher standards, and gradually more affordable preventive healthcare.”
Cost efficiencies, not instant discounts
For the pharmaceutical industry, the India-EU FTA is expected to reduce duties on high-value equipment and specialised manufacturing systems sourced from Europe. These include precision machinery, sterile production lines, analytical instruments and advanced quality-testing technologies used by Indian drug makers.
Parag Bhatia, Director at Laborate Pharmaceuticals said that while Indian consumers are unlikely to see an immediate fall in medicine prices, the agreement can generate meaningful cost efficiencies over time. “Reduced duties on imported machinery can lower capital expenditure and compliance costs, particularly for companies upgrading plants to meet European quality standards.”
Bhatia explains that better access to advanced equipment can improve productivity, reduce wastage and enhance supply reliability. Over the medium term, these efficiencies could support more stable pricing and better medicine availability even if the impact is not immediately visible on patient bills, he said.
Boost for exports, devices and traditional medicine
Beyond domestic pricing, the FTA is expected to significantly improve market access for Indian manufacturers in the EU, one of the world’s largest pharmaceutical and MedTech markets. Duty-free exports could make Indian medicines and devices more competitive, potentially increasing volumes and revenues.
Dr Saurabh Arora, Managing Director of Auriga Research described the agreement as a major achievement for the pharmaceutical industry. He said that duty-free imports from the EU and exports into Europe could make it cheaper to buy and sell medicines on both sides. Lower costs for imported active pharmaceutical ingredients (APIs), excipients and chemicals used in Indian manufacturing could also strengthen domestic production.
Dr Arora adds that the FTA extends beyond pharmaceuticals, with provisions related to Ayush and traditional medicine, opening new opportunities for India’s wellness and alternative medicine sectors in European markets.
However, he warned that success will depend on how quickly Indian manufacturers can scale up quality, compliance and skilled manpower to meet the EU’s stringent regulatory standards. He also pointed out that the enforcement of revised Schedule M norms has already pushed many Indian companies to upgrade facilities, with several moving closer to EU-level standards.
So, will patients benefit?
Taken together, the India-EU FTA appears more likely to transform the healthcare ecosystem than deliver instant savings at the chemist. While tariffs on drugs, devices and inputs may fall, the translation of these benefits into lower medical bills will depend on pricing policies, regulation and how companies pass on cost savings.
For patients, the early gains may come in the form of improved access, better quality products and more stable supplies while cheaper medicines, if they arrive are likely to be a longer-term outcome rather than an immediate dividend of the trade deal.
End of Article