Indian pharmaceutical stocks fell 1.7% on Wednesday after US President Donald Trump reiterated plans to announce a "major" tariff on all pharmaceutical imports.

US accounts for a third of India's overall pharma exports.

Trump had also threatened the duties on Friday, after his first set of reciprocal tariffs announced last week exempted pharma products -- a change in stance that had prompted a wild swing in pharma stocks.

While the reciprocal tariffs have taken effect, Trump has not said when and by how much he plans to raise taxes on pharma imports.

On the day, all 20 constituents of India's pharma index were lower, with the index dragging down the benchmark Nifty 50 by about 0.59% as of 10:50 am IST.

"This is playing a lot on investors' sentiment and is an overhang until the time when announcement of the tariffs happens," said Shrikant Alkokar, equity analyst at Nuvama Group.

Biocon, Laurus Labs and Lupin were the top losers by percentage, down between 3% and 5%. For the year ended March 2024, Biocon and Lupin earned 44% and 37% of their revenues from the US while Laurus Labs earned about 17% from the North American market.

Among the top index constituents by weight, Sun Pharmaceutical Industries, Cipla, and Dr Reddy's Laboratories were down between 1% and 2%.

Trump has said that the tariffs will incentivize drug companies to move their operations to the U.S. However, analysts and companies have raised concerns on the difficulty in setting up manufacturing in the US.

India's pharma exports to the US mostly comprise generics, or cheaper versions of popular drugs. These currently attract almost no US levies, while India imposes about 10% tax on U.S. pharma imports, according to industry experts.

The pharma index has fallen 14.4% this year.