Budget 2026-27 removes customs duty on over 100 categories of drug raw materials
The Finance Minister announced the full removal of customs duty on raw materials for locally made medicines, including cancer treatments.
In this article
Presenting the federal budget for 2026-27 in the National Assembly on 12 June 2026, Finance Minister Muhammad Aurangzeb announced the complete abolition of customs duty on more than 100 categories of raw materials used to make medicines in Pakistan, APP reported.
What was announced
- The exemption covers raw materials for domestic medicine manufacturing, including medicines for cancer and other serious diseases.
- It falls under the National Tariff Policy 2025-30.
- The minister said the aim was to make “life-saving treatments more affordable and accessible across the country,” noting the strain cancer places on families.
Why raw materials matter so much
Pakistan makes most of its finished medicines at home but imports almost all of its active ingredients and other raw materials. Health Minister Mustafa Kamal put the figure at almost 90% in July 2026. Every rupee of duty on those inputs flows into the price of the finished product, so removing it lowers production costs directly.
What it means for the supply chain
| Who | Likely effect |
|---|---|
| Manufacturers | Lower landed cost of imported inputs for covered categories |
| Importers and distributors of APIs | Simpler pricing on covered materials |
| Patients | The stated aim is cheaper life-saving treatment |
What to watch
The full list of covered tariff lines matters: manufacturers will need to check which of their inputs qualify. Lower duty also makes imported inputs cheaper relative to any future local production, so it sits alongside, rather than replaces, the push to make APIs at home — see why Pakistan imports almost 90% of its APIs.
Raw material suppliers and importers exhibit across Halls 1–3 at Pharma Asia 2026.
