Indian pharma exporters feel pain on Bangladesh crisis

The political unrest and related violence in Bangladesh have led to significant losses for the Indian pharmaceuticals industry as many exporters of drugs and ingredients have their money stuck in the neighbouring country, industry insiders said.

Pharma companies are now hesitant to supply to Bangladesh as outstanding payments have become significant and they are concerned about their financial stability, in a development that could impact availability of medicines in the neighbouring country.

"Any crisis that affects trade could lead to delays in supply, increased costs, or even interruptions in medication availability," an industry expert told ET on condition of anonymity.



All major Indian pharma companies and many medium and small enterprises are likely to get affected if the crisis continues, he added.

India exports 30% of the total active pharmaceutical ingredients (APIs) and other related raw materials to Bangladesh.

India's shipment of pharmaceutical products to the neighbouring country was worth only $50.3 million in 2023, but the market offers big growth potential.

"Indian companies are resisting to supply material without advance. Their money is stuck," a pharma industry analyst said. "Remittances are not coming, so no company will be interested in supplying. It (supply) is going to be hit hard," he said.


Indian pharma companies that have manufacturing units in Bangladesh and those selling a significant chunk of their products there would find it difficult to sustain, the analyst said. "Indian companies with global scale have recognised there will be disruptions, so risk management is the key for all the companies," he added.

Many Indian pharma companies have a strong presence in Bangladesh, Sun Pharma recently opened a plant in Bangladesh-its second major investment there that came as part of growing economic and industrial engagement between Bangladesh and India.

The development may impact healthcare services in Bangladesh.

"In the past decade, Bangladesh pharmaceutical companies have made notable improvements in the quality of their medicines by upgrading technology, but they import from China, South Korea and India," the expert cited above said. "The crisis is going to affect the country's healthcare and pharma sectors immensely."

The political crisis in Bangladesh has already impacted the flow of patients to India. Many patients have cancelled or postponed their travel plans, causing up to 50% drop in the visits of such patients at some hospitals of major chains.