Brief overview of the medical device industry
Developing import duties on medical devices is growing healthcare costs, with 82% of industry experts anticipating a 15% increase in hospital costs within six months, risking patient access to affordable care. These tariffs, alongside a new 5% “health cess” on specific imports, mainly impact hospital capital expenditure, causing supply shortages & potentially limiting innovation.
The medical device industry develops, manufactures, & distributes tools ranging from surgical gloves to AI-driven imaging used for diagnosing and managing health conditions. The heavily regulated & R & R & R&D-driven sector is experiencing rapid growth, expected to exceed US$ 50 billion in India by 2030, & continuing global innovation to improve care.
Impact on Healthcare Costs & Operations
Enhance Costs: Tariffs directly develop the purchase cost of medical-grade raw materials & finished high-accuracy equipment.
Minimize Margins: Hospitals & manufacturers face forced margins, as they must often absorb costs or risk losing patients due to high prices.
Supply Shortages: Risk from tariffs makes delays in collecting necessary, & sometimes lifesaving, medical technology.
Reduced development: The high costs slow down the adoption of newer, advanced, & often more expensive medical technologies.
Major Medical Devices Affected by Rising Duties
Developing duties, tariffs, & trade tensions, mainly in India, are affecting the costs & availability of imported medical devices, leading to calls for increased domestic manufacturing. Imports in over 11 major product categories have increased, with high-end, electronics-heavy equipment mainly affected.
Medical Devices Affected by Rising Duties (2025–2026):
Imaging & Diagnostic Equipment: High-end, imported diagnostic tools face important duty pressures, with MRI machines, CT-scan machines, linear accelerators, mammograms, C-arms, & ultrasound machines.
Cardiology & Surgical Instruments: Cardiac stents, catheters, heart valves, & specialized surgical robots are highly impacted due to heavy reliance on imports from the US, China, & Germany.
Consumables & Disposables: Syringes & needles have monitored some import surges. Other affected items include surgical gloves, oxygen therapy devices, & personal protective equipment.
Components & Raw Materials: Tariffs are increasing the prices of raw materials for locally managed devices, including stepper motors, control boards, laser modules, & plastic components used in manufacturing.
Impact on Healthcare Costs
Managing healthcare costs mainly affects overall budgets, forces the allocation of care, & leads to medical debt, with pharmacy spending increasing by $50 billion in 2024 alone. These costs drive up insurance premiums, minimize disposable income, & overly affect low-income individuals. High costs skip treatments & lead to declining long-term conditions.
Growing healthcare costs create financial issues for patients, healthcare providers, employers, & governments. High expenses for medical services, treatments, & prescription often lead to financial hardship & long-term debt for many families. Due to affordability concerns, patients mainly delay or avoid necessary medical care, which can decline health conditions & increase treatment costs in the future. At the same time, developing ongoing healthcare expenses place a heavy risk on both public & private sectors, increasing insurance premiums for employers & minimizing funds that could otherwise support business growth, employee income, or infrastructure development
Managing Domestic Growth & Healthcare Affordability
Managing domestic healthcare growth with affordability is an important, multi-faceted challenge, mainly in developing economies like India, where the sector is projected to reach $700 billion by 2030. Achieving this balance needs joining private sector investment, important for network & development, with regulatory frameworks that protect patients from high out-of-pocket costs.
Conclusion
Developing import duties on medical devices is changing the healthcare industry by increasing equipment costs, delaying supply chains, & placing additional financial pressure on hospitals & patients. While these measures are often introduced to encourage domestic manufacturing & minimize dependence on imports, they can also make advanced healthcare technologies less affordable & accessible in the short term. The growing cost risks affect not only healthcare providers but also individuals who already face high t medical expenses.
Did you know?
India’s Exports to the USA were Rs 5667 Cr. in 2024, up by 2 per cent from the preceding year and Imports from the USA were 12552 Cr.
FAQ
1. Why are medical device costs increasing in India?
Costs are rising primarily due to higher import tariffs, shipping disruptions (particularly around the Strait of Hormuz), and a weak rupee.
2. What relief measures has the medical device industry requested?
The industry is requesting a temporary three-month customs duty rebate to offset rising costs and demanding the removal of the health cess on imports.
3. Are Indian medical devices becoming cheaper?
While the government is promoting “Make in India” through PLI schemes, currently, the high reliance on imports means many advanced devices remain expensive, with patients paying 10-30 times the landed cost of imported items.
4. What is the impact of the US-India tariff negotiations?
Recent negotiations aim to reduce tariffs on high-value, US-made medical equipment, which could lower costs, but local manufacturers are calling for strategic protection in other areas.
5. Are imports of medical devices rising in India?
Yes, imports have remained high, exceeding ₹69,000 crore in recent periods, despite initiatives to boost local production.
