India’s pharmaceutical sector could face losses of ₹2,500–₹5,000 crore if exports to the Gulf Cooperation Council (GCC) and the wider West Asia and North Africa (WANA) region are fully disrupted in March due to the ongoing conflict in West Asia, according to the Pharmaceuticals Export Promotion Council of India.
The council warned that escalating tensions in the region are already straining freight capacity, shipping routes, and delivery timelines, raising concerns for Indian drugmakers that depend heavily on the region as a key export market.
GCC countries account for about 5.58% of India’s total exports, with pharmaceuticals emerging as a fast-growing segment. Industry data shows Indian pharma exports to the WANA region rising from $1.32 billion in FY 2020–21 to $1.75 billion in FY 2024–25.
Several countries in the region—including the United Arab Emirates, Saudi Arabia, Oman, Kuwait and Yemen—depend significantly on India for affordable medicines. Demand has also been expanding in emerging markets such as Jordan and Libya, particularly for vaccines, surgical products and AYUSH formulations.
However, this growth is now under threat as the conflict disrupts global logistics networks.
Cold-chain concerns and freight surge
Pharmexcil Chairman Namit Joshi said tensions have affected critical maritime and air cargo corridors serving the region.
Key shipping routes such as the Red Sea and the Strait of Hormuz are facing increased risks of rerouting and delays, potentially affecting delivery schedules.
The disruption poses a particular challenge for temperature-sensitive pharmaceutical products, where prolonged transit times could damage medicines due to cold-chain interruptions.
Freight costs have already surged sharply, with the council noting that shipping charges for both imports and exports have doubled in some cases. Indian exporters are also facing additional surcharges of $4,000–$8,000 per shipment, significantly increasing operational costs.
Beyond freight, the conflict is pushing up broader supply-chain expenses, including higher crude oil prices, rising logistics costs for active pharmaceutical ingredients (APIs) and finished formulations, and shipping delays that could disrupt inventory cycles.
Pharmexcil said it is closely monitoring the situation and engaging with logistics providers and trade stakeholders to mitigate the impact. The council has also recommended stronger coordination with government authorities for potential freight relief measures, diversification of shipping routes, and exploring alternative logistics solutions to maintain timely medicine supplies to key international markets.
