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China has exempted import tariffs on 28 essential drugs, including cancer medicines, from May 1, a move which will help bring down India’s trade deficit with the country, Chinese Ambassador to India Luo Zhaohui said on Thursday.
“China has exempted import tariffs for 28 drugs, including all cancer drugs, from May 1. Good news for India’s pharmaceutical industry and medicine export to China. I believe this will help reduce trade imbalance between China and India in the future,” Ambassador Luo Zhaohui tweeted on Thursday.
While the decision taken by the Chinese Ministry of Finance is not exclusive to India, the removal of import tariffs could help the Indian pharmaceutical industry make gains into the Chinese market if it does not encounter non-tariff barriers in the form of tough regulatory measures.
India’s trade deficit with China has widened to a whopping $62.8 billion in 2017-18 from $51 billion a year before.
During the visit of Chinese Commerce Minister Zhong Shan last month to participate in the joint economic group (JEG) meeting, China noted India’s concern regarding the long existing trade imbalance and requests for market access and committed to address these concerns through the broad framework provided by successive JEGs and the Five Year Development Programme for economic and trade cooperation between the two countries.
The two sides also agreed to promote bilateral trade in pharmaceuticals including resolution of issues of Indian pharma products exports to Chinese markets.
China’s move to exempt import tariffs on the select drugs follows an executive meeting of China’s State Council on April 12. A statement was released after the meeting which said that import tariffs on all common drugs including cancer drugs, cancer alkaloid-based drugs, and imported traditional Chinese medicine will be exempt from May 1.
“The authorities will reduce the prices of cancer drugs through centralised government procurement and eliminate premium prices for drugs by means of cross-border e-commerce. Imported innovative drugs, especially much-needed cancer drugs, will be incorporated into the catalogue of medical insurance reimbursement,” the statement reportedly said.
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