Peru withdraws health emergency and national emergency making Indian pharma export costly

Mumbai, November 14, 2022:

The Peruvian government has withdrawn national state of emergency and health emergency restoring tariff duties on the 77 products ranging from chemicals, pharmaceuticals and medical devices. This will increase prices of imported pharmaceutical products in the South American nation which imported drugs worth USD 120.17 million from India last year.

India was the second leading exporter of pharmaceutical products to Peru in 2021 after the USA which exported drugs worth USD 215 million to the South American country during the same year.
 
On October 27, 2022 the Peruvian government vide its Supreme Decree No. 130-2022-PCM decided to put an end to the health emergency and national state of emergency that started on March 15, 2020 with Supreme Decree 008-2020-SA, hence restoring the tariff duties on the 77 items with the benefit. The original tariff duties in some of the products are 0 per cent, 6 per cent or 11 per cent.
 
Supreme Decree No. 051-2020-EF was published two days after Supreme Decree 008-2020-SA which established a reduction on tariffs to zero on certain products ranging from chemicals, pharmaceuticals and medical devices to help during the health emergency. The list included 65 items which further grew to 77 items vide Supreme Decree No. 059-2020-EF dated March 28, 2022. This reduction on tariff duties were extended automatically until February 24, 2023 with the extension of the health emergency on August 16, 2022 vide Supreme Decree 015-2022-SA.
 
Last month the Peruvian government vide Supreme Decree No. 130-2022-PCM decided to finalize the health emergency and the national state of emergency, derogating Supreme Decree No. 015-2022-SA and automatically S.D. 059-2020-EF thus restoring the tariff duties on the 77 items.
 
The Pharmaceuticals Export Promotion Council of India (Pharmexcil) has called on member companies having business operations in Peru to take note of this.
 
A business delegation from India under the aegis of the Pharmexcil visited Colombia, Bolivia, Peru and Brazil from July 30, 2022 to August 13, 2022 to discuss a roadmap for greater access to Indian pharma companies in their respective markets. As global pharma companies are leaving South America after Covid-19 pandemic, the Pharmexcil is looking to promote Indian pharmaceutical exports in the Latin American and Caribbean Region (LAC).
 
UdayaBhaskar, director general, Pharmexcil, said the Indian pharma sector still has a huge potential to expand its base and exports to the region. Most of the regions within LAC witnessed economic degrowth during the Covid-19 pandemic; as a result, many multinational pharma companies exited the region. Despite these Covid challenges, Indian pharma exports reported 18 per cent growth in the last two years, he said.
 
Currently India is negotiating a free trade agreement with Peru. Pharmaceuticals trade is a part of this agreement. At present Peru does not impose any duty on India’s bulk drug exports under chapter 29, while India imposes 7.5 per cent import duty on their exports, if any, of the same to India. Peru imposes 6 per cent duty on imports from India on some of the finished dosage formulations and imposes no duty on the rest, while India imposes 10 per cent. Negotiations can also be made to make the present 6 per cent to zero on finished dosages exports also.Pharmabiz