Pakistan exempts pharmaceutical industry from India trade ban

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Men arrange medicine packs on the shelves of a pharmacy in Peshawar, Pakistan May 23, 2018. (REUTERS)
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A man sorts and arranges medicine packs at a pharmacy store in Peshawar, Pakistan March 28, 2019. (REUTERS)
Updated 04 September 2019
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Pakistan exempts pharmaceutical industry from India trade ban

  • Medicines and pharmaceutical raw material embargoed at Karachi port since ban imposed on August 9
  • Around 50 percent of medicines made in Pakistan use raw materials from India

KARACHI/ISLAMABAD: Pakistan’s commerce ministry said on Tuesday it had exempted the pharmaceutical industry from a ban on bilateral trade with India announced last month after New Delhi stripped the disputed Kashmir region of its special status, sparking tensions between the nuclear-armed neighbors.
The ban went into effect on August 9 and since then, consignments of medicines and pharmaceutical raw material have been stuck at the Karachi port, diverted to other destinations or returned to India, raising fears in Pakistan of “acute shortages” of life-saving drugs and vaccines.
Around 50 percent of medicines made in Pakistan use raw materials from India, according to the Pakistan Pharmaceutical Manufacturers Association. Pakistan imports around 150 medicines and vaccines from India each year, data from the Senate Committee on National Health Services shows, and in 2019 alone, according to the Pakistani ministry of health, medicines worth Rs.136,99,87,000 were imported by Pakistan from India.
The commerce ministry confirmed to Arab News on Tuesday that the embargo on the import of medicines and pharmaceutical raw materials from India had been lifted after approval from the federal cabinet.
The confirmation follows a notification dated September 2 in which the commerce ministry said the trade ban “shall not apply to therapeutic products regulated by the Drug Regulatory Authority of Pakistan,” meeting a nearly month-long demand by drug regulators, pharmaceutical companies and associations that represent manufacturers.
Concerns that Pakistan’s drug manufacturers would soon be unable to supply life-saving medicines due to the industry’s dependence on India began emerging soon after the trade ban was imposed.

On August 21, the Pakistan Pharmaceutical Manufacturers Association (PPMA), Drug Regulatory Authority of Pakistan (DRAP), Pharma Bureau and other relevant bodies, as well as representatives of major pharmaceutical companies, held an emergency meeting with Commerce Minister Abdul Razak Dawood and top officials of the ministry of health in Islamabad to discuss the issue of looming shortages.
At least three officials who attended the meeting told Arab News the commerce minister was not in favor of an embargo on pharmaceutical raw materials and medicines, and assured attendees that he would get cabinet approval to lift the ban.
“He reassured us that the pharma industry would be exempted from this ban,” a senior official at DRAP said, declining to be named because all stakeholders who attended the meeting were requested not to speak to the media.
Dawood declined to provide details of the meeting when contacted by Arab News, telling a correspondent via phone: “I don’t deal with India. I don’t know anything about this.”




In a letter dated August 16, the Pakistan Pharmaceutical Manufacturers Association approached the Drug Regulatory Authority of Pakistan for clearance of Indian-origin raw materials and medicines stuck at Karachi port, complaining that even consignments contracted before the trade ban went into effect on August 9 were not being allowed to be offloaded at the port by authorities.

In a letter dated August 16, PPMA approached the drug regulator for clearance of Indian-origin raw materials and medicines stuck at Karachi port, complaining that even consignments contracted and billed before the trade ban went into effect were not being allowed to be offloaded at the port by authorities.
As of Monday, September 1, at least three officials of the PPMA contacted by Arab News said consignments contracted or billed before the trade ban was announced had still not been allowed into Pakistan despite a notification from the commerce ministry that orders completed prior to the ban would not be blocked.
Dr. Tahir Azam, senior vice chairman of the PPMA, said the body was now working round the clock to identify alternate sources of raw material.
But Ayesha Tammy Haq, Executive Director of the Pharma Bureau, which represents multinational pharmaceutical companies in Pakistan, said changing the source of raw material would take a substantial amount of time.
“First you will have to identify the source; that would take at least 2-3 months, then you will have to test the stability of the material,” Haq said. “Stability testing takes minimum 6-8 months and then due to stringent testing of multinational companies, they take, by conservative estimates, from 10-18 months to change source.”

A letter written by the Pakistan Chemists and Druggists Association (PCDA) to the Ministry of National Health Services dated August 16, 2019, named at least ten medicines imported exclusively from India at lower rates.

A letter written by the Pakistan Chemists and Druggists Association (PCDA) to the Ministry of National Health Services last month named at least ten medicines imported exclusively from India at lower rates.
These include: 1) Anti-snake venom serum (Pakistan-specific product only available from India) 2) World Health Organization prequalified vaccines 3) Anti-rabies vaccines 4) Equine anti-thymocyte globulin (only one brand currently available from India) 5) Equine Rabies Immunoglobulin (only one brand currently available from India) 6) Oncology products, including Onco BCG 7) Streptokinase 8) Halothane (only one available brand from India) 9) Recombinant biologicals and fertility hormones 10) and antifungals.
“In the absence of the above products, there will be an absolute chaos. Patients for a majority of the products will have no recourse,” the PCDA letter read. “For other product lines, the alternate products from Europe/United States/stringent regulated markets, are going to be far more expensive that their generics from India.”
“We can import [raw materials] from Europe or American but it would increase the cost almost by ten times,” Pharma Bureau’s Haq said. “Medicines are immune to global political and regional conflicts under the United Nations and should not be subjected to such impacts.”
“I think we, as a country, people and government, must understand that one thing, medicines, should not be touched [in times of conflict] because this is in the larger interest of people,” Haq said. “We all can live without tomatoes but if you are suffering from Tuberculosis, you can’t survive without anti-TB medicine,” she said, referring to a disease whose raw material is imported mainly from India.


IMF warns against policy slippage amid weak recovery as it clears $1.2 billion for Pakistan

Updated 11 December 2025
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IMF warns against policy slippage amid weak recovery as it clears $1.2 billion for Pakistan

  • Pakistan rebuilt reserves, cut its deficit and slowed inflation sharply over the past one year
  • Fund says climate shocks, energy debt, stalled reforms threaten stability despite recent gains

ISLAMABAD: Pakistan’s economic recovery remains fragile despite a year of painful stabilization measures that helped pull the country back from the brink of default, the International Monetary Fund (IMF) warned on Thursday, after it approved a fresh $1.2 billion disbursement under its ongoing loan program.

The approval covers the second review of Pakistan’s Extended Fund Facility (EFF) and the first review of its climate-focused Resilience and Sustainability Facility (RSF), bringing total disbursements since last year to about $3.3 billion.

Pakistan entered the IMF program in September 2024 after years of weak revenues, soaring fiscal deficits, import controls, currency depletion and repeated climate shocks left the economy close to external default. A smaller stopgap arrangement earlier that year helped avert immediate default, but the current 37-month program was designed to restore macroeconomic stability through strict monetary tightening, currency adjustments, subsidy rationalization and aggressive revenue measures.

The IMF’s new review shows that Pakistan has delivered significant gains since then. Growth recovered to 3 percent last year after shrinking the year before. Inflation fell from over 23 percent to low single digits before rising again after this year’s floods. The current account posted its first surplus in 14 years, helped by stronger remittances and a sharp reduction in imports. And the government delivered a primary budget surplus of 1.3 percent of GDP, a key program requirement. Foreign exchange reserves, which had dropped dangerously low in 2023, rose from US$9.4 billion to US$14.5 billion by June.

“Pakistan’s reform implementation under the EFF arrangement has helped preserve macroeconomic stability in the face of several recent shocks,” IMF Deputy Managing Director Nigel Clarke said in a statement after the Board meeting.

But he warned that Islamabad must “maintain prudent policies” and accelerate reforms needed for private-sector-led and sustainable growth.

The Fund noted that the 2025 monsoon floods, affecting nearly seven million people, damaging housing, livestock and key crops, and displacing more than four million, have set back the recovery. The IMF now expects GDP growth in FY26 to be slightly lower and forecasts inflation to rise to 8–10 percent in the coming months as food prices adjust.

The review warns Pakistan against relaxing monetary or fiscal discipline prematurely. It urges the State Bank to keep policy “appropriately tight,” allow exchange-rate flexibility and improve communication. Islamabad must also continue raising revenues, broadening the tax base and protecting social spending, the Fund said.

Despite the progress, Pakistan’s structural weaknesses remain severe.

Power-sector circular debt stands at about $5.7 billion, and gas-sector arrears have climbed to $11.3 billion despite tariff adjustments. Reform of state-owned enterprises has slowed, including delays in privatizing loss-making electricity distributors and Pakistan International Airlines. Key governance and anti-corruption reforms have also been pushed back.

The IMF welcomed Pakistan’s expansion of its flagship Benazir Income Support Program, which raises cash transfers for low-income families and expands coverage, saying social protection is essential as climate shocks intensify. But it warned that high public debt, about 72 percent of GDP, thin external buffers and climate exposure leave the country vulnerable if reform momentum weakens.

The Fund said Pakistan’s challenge now is to convert short-term stabilization into sustained recovery after years of economic volatility, with its ability to maintain discipline, rather than the size of external financing alone, determining the durability of its gains.