West Asia tensions push up pharma raw material costs, raise concerns for Indian drug prices
Rising raw material and freight costs linked to geopolitical tensions in West Asia are putting pressure on India’s pharmaceutical supply chains, raising concerns over higher medicine prices and export losses.
- By PharmaNews Live Desk
- New Delhi
- Mar 11, 2026
Escalating geopolitical tensions in West Asia are beginning to impact India’s pharmaceutical sector, with rising costs of key raw materials and shipping threatening to disrupt supply chains and increase medicine prices.
According to an original report by The Economic Times, the prices of pharmaceutical ingredients used to manufacture several medicines have surged sharply in recent weeks as supply chains face disruptions linked to the regional conflict.
Raw material prices surge across supply chain
Industry data cited in the report indicates that the prices of key pharmaceutical ingredients have risen by around 30% in recent weeks, largely due to logistical bottlenecks and rising shipping costs.
Industry officials said importers are increasingly passing on higher costs to pharmaceutical manufacturers.
“Importers, squeezed by surging raw material costs, are passing the pain directly to big pharma companies,” an industry executive was quoted as saying in the ET report.
The shortage of vessels and disruption of shipping routes have slowed the movement of chemical inputs and active pharmaceutical ingredients (APIs), many of which are sourced from international markets including China.
Key inputs see sharp price increases
Several widely used pharmaceutical inputs have seen steep price increases over the past few months.
According to the ET report, glycerine prices have risen by nearly 64% since December, while paracetamol prices have increased by about 26%, reflecting broader volatility in chemical and pharmaceutical supply chains.
These cost pressures could eventually translate into higher production costs for drug manufacturers and potentially impact retail medicine prices if the trend continues.
Export shipments face disruption risk
The geopolitical situation is also creating uncertainty for India’s pharmaceutical exporters.
Industry estimates cited in multiple reports suggest that pharmaceutical exports worth ₹2,500–₹5,000 crore could be affected if disruptions to shipping routes persist.
India exports a large volume of generic medicines to countries in West Asia and the Gulf region, making the stability of trade routes through the region critical for the industry.
Freight costs add to industry pressure
In addition to raw material price increases, pharmaceutical exporters are facing a sharp rise in freight costs and logistical challenges.
Shipping surcharges have increased significantly due to limited vessel availability and heightened risks in regional maritime routes. For pharmaceutical companies—many of which rely on temperature-controlled logistics—such disruptions can lead to delays and higher transportation costs.
Industry bodies are closely monitoring the situation and have urged authorities to consider support measures if disruptions continue.
Sector monitoring geopolitical developments
India remains one of the world’s largest suppliers of generic medicines, and global supply chain stability is essential for both domestic manufacturing and exports.
With tensions in West Asia continuing to evolve, the pharmaceutical industry is closely watching developments that could further affect raw material availability, freight costs and export logistics.
Experts warn that sustained geopolitical instability could place additional pressure on pharmaceutical manufacturers already dealing with volatile input costs and complex global supply chains.