How India Exports Herbal to the World

In the United States, herbal medicaments are subject to stringent regulatory oversight by the Food and Drug Administration (FDA). The FDA's Orange Book, which lists approved drug products, does not specifically categorize herbal products under HS Code 30049011. This indicates that such products may not have received approval through the Abbreviated New Drug Application (ANDA) pathway. Consequently, Indian exporters aiming to enter the U.S. market must navigate the FDA's regulatory framework, which includes compliance with the Dietary Supplement Health and Education Act (DSHEA) if the products are marketed as dietary supplements, or the New Drug Application (NDA) process if they are intended as therapeutic agents. Given the presence of 320 active Indian exporters in this category, a thorough understanding of these regulatory pathways is essential for successful market entry.

In the European Union (EU) and the United Kingdom (UK), herbal medicinal products are regulated under specific directives and guidelines. The European Medicines Agency (EMA) oversees the registration of traditional herbal medicinal products through a simplified registration procedure, provided they meet criteria such as proven safety and at least 30 years of medicinal use, including 15 years within the EU. Similarly, the UK's Medicines and Healthcare products Regulatory Agency (MHRA) requires herbal products to be registered under the Traditional Herbal Registration (THR) scheme. Compliance with Good Manufacturing Practice (GMP) standards is mandatory, ensuring product quality and safety.

The World Health Organization (WHO) includes certain herbal medicines in its Model List of Essential Medicines, recognizing their importance in healthcare systems. The inclusion of specific herbal products varies across different editions of the list. Additionally, the WHO Prequalification Programme sets global standards for the quality, safety, and efficacy of medicinal products, including herbal medicines. Compliance with pharmacopoeial standards such as the United States Pharmacopeia (USP), British Pharmacopoeia (BP), European Pharmacopoeia (EP), and Indian Pharmacopoeia (IP) is crucial for international acceptance and marketability of these products.

In India, herbal medicaments are regulated by the Central Drugs Standard Control Organisation (CDSCO) under the Ministry of Health and Family Welfare. These products are typically classified under Schedule E(1) of the Drugs and Cosmetics Act, 1940, which pertains to substances of plant origin used in Ayurvedic, Siddha, and Unani systems of medicine. The National Pharmaceutical Pricing Authority (NPPA) monitors the pricing of pharmaceutical products; however, as of March 2026, there are no specific ceiling prices set for herbal medicaments under the Drug Price Control Order (DPCO). For export purposes, obtaining a No Objection Certificate (NOC) from the Directorate General of Foreign Trade (DGFT) is mandatory, ensuring compliance with national regulations and facilitating international trade.

Herbal medicaments often face challenges in obtaining patent protection due to their traditional use and natural origin. In the United States, the FDA's Orange Book lists patents associated with approved drug products, primarily covering new chemical entities, formulations, and specific therapeutic uses. As of March 2026, there are no patents listed in the Orange Book for products under HS Code 30049011, indicating a lack of exclusivity and potential for generic competition. This absence of patent protection necessitates a focus on quality, efficacy, and compliance with regulatory standards to maintain a competitive edge in the market.

In June 2025, the Indian Ministry of AYUSH introduced new guidelines to enhance the quality control of Ayurvedic products, emphasizing the need for standardized manufacturing processes and rigorous testing protocols. This policy change aims to bolster the credibility and marketability of Indian herbal medicaments on the global stage.

In September 2025, the WHO updated its guidelines on Good Manufacturing Practices (GMP) for herbal medicines, aligning them more closely with those for conventional pharmaceuticals. This revision underscores the importance of stringent quality assurance measures in the production of herbal products.

In December 2025, the EMA approved a new traditional herbal medicinal product under the simplified registration procedure, highlighting the EU's commitment to integrating traditional medicines into its healthcare system. This approval sets a precedent for future registrations of similar products.

In February 2026, the FDA issued a warning letter to a U.S. distributor of imported herbal supplements for non-compliance with labeling and marketing regulations, reinforcing the agency's strict oversight of herbal products in the market.

In March 2026, the Indian government announced a subsidy program to support small and medium-sized enterprises (SMEs) in the herbal medicine sector, aiming to enhance their production capabilities and export potential.

These developments reflect a dynamic regulatory environment and underscore the importance of compliance and quality assurance in the herbal medicament industry.

India's pharmaceutical industry, including the herbal sector, heavily relies on Active Pharmaceutical Ingredients (APIs) and Key Starting Materials (KSMs) imported from China. Approximately 60–70% of these critical components are sourced from China, underscoring a significant supply chain vulnerability. This dependency exposes Indian exporters to potential disruptions stemming from geopolitical tensions, trade restrictions, or quality control issues within Chinese manufacturing facilities.

Recent events have highlighted these risks. In February 2025, the U.S. Food and Drug Administration (FDA) issued warning letters to API manufacturers in China and India for significant deviations from current Good Manufacturing Practices (cGMP), including quality control failures and data integrity issues. Such regulatory actions can lead to supply shortages and increased scrutiny, further complicating the procurement of essential raw materials for herbal product exports.

The export market for herbal products from India is notably concentrated among a few key players. The top five exporters—Sun Pharmaceutical Industries Limited, Emami Limited, Surya Herbal Limited, Jangir Exports, and J B Chemicals and Pharmaceuticals Limited—collectively account for 38.0% of the total export value, with Sun Pharmaceutical Industries Limited alone contributing 18.8%. This concentration poses a single-source risk, where disruptions affecting these major suppliers could significantly impact the overall supply chain.

To mitigate such risks, the Indian government has implemented the Production Linked Incentive (PLI) scheme aimed at reducing dependency on imports for critical pharmaceutical ingredients. In November 2024, two greenfield plants were inaugurated under this scheme to manufacture essential molecules like Penicillin G and Clavulanic Acid, which are vital for antibiotic production. While these initiatives are steps toward self-reliance, their impact on the herbal export sector remains to be fully realized.

Recent geopolitical tensions have significantly disrupted global shipping routes critical for India's herbal exports. In March 2026, the Strait of Hormuz—a vital passage for maritime trade—was effectively blockaded due to escalating conflicts involving Iran, the U.S., and Israel. This blockade halted maritime traffic in the Persian Gulf, severely affecting global trade and leading to increased shipping costs and delays. (lemonde.fr) Additionally, heightened security risks in the Red Sea and the Suez Canal corridor have prompted major carriers to suspend or reroute transits, extending transit times by 10–20 days and raising freight rates by 40–50% on key India–Europe routes.

These disruptions have a cascading effect on the supply chain, leading to increased costs and potential delays in delivering herbal products to key markets. The reliance on these maritime routes underscores the vulnerability of India's herbal export sector to geopolitical instabilities.

• Diversify Supplier Base: Encourage the development of alternative domestic sources for APIs and KSMs to reduce dependency on imports, particularly from China.

• Enhance Regulatory Compliance: Strengthen quality control measures and ensure adherence to international cGMP standards to mitigate risks associated with regulatory actions.

• Invest in Infrastructure: Develop and utilize alternative shipping routes and logistics infrastructure to circumvent geopolitical hotspots and reduce transit times.

• Strengthen Supplier Relationships: Foster long-term partnerships with multiple suppliers to distribute risk and ensure a more resilient supply chain.

• Monitor Geopolitical Developments: Establish a dedicated team to continuously assess geopolitical risks and develop contingency plans for potential disruptions.

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