NEW DELHI: India has fully protected sensitive agricultural and dairy products, including maize, wheat, rice, soya, poultry, milk, cheese, fuel ethanol, tobacco, certain vegetables and meat, with no duty concessions granted to the United States under the trade agreement.
India and the US announced on Saturday that they had reached a framework for an interim trade agreement. Under this framework, the US will reduce tariffs on Indian goods to 18 per cent, down from the earlier 50 per cent.
“The agreement reflects India’s commitment to safeguarding farmers’ interests and sustaining rural livelihoods by fully protecting sensitive agricultural and dairy products, including maize, wheat, rice, soya, poultry, milk, cheese, fuel ethanol, tobacco, certain vegetables and meat,” Commerce and Industry Minister Piyush Goyal said in a post on social media.
These products are considered sensitive as they are directly linked to the livelihoods of small and marginal farmers across the country.
As in several other Free Trade Agreements (FTAs), India has not extended import duty concessions on sensitive agricultural and dairy products. The country has recently concluded FTAs with the European Union, the United Kingdom and Australia.
Agriculture and allied activities, including animal husbandry, form the backbone of India’s rural economy, providing employment to more than 700 million people. Unlike developed economies, where agriculture is highly mechanised and corporatised, farming in India remains primarily a means of livelihood.
India’s agricultural sector is currently protected by moderate to high tariffs and regulatory measures aimed at shielding domestic farmers from unfair competition.
US agricultural exports to India amounted to USD 1.6 billion in 2024. Key exports included almonds (in-shell) valued at USD 868 million, pistachios worth USD 121 million, apples worth USD 21 million, and ethanol (ethyl alcohol) valued at USD 266 million.
Given that more than 50 per cent of India’s population depends on agriculture for its livelihood, the country treats the entire sector as sensitive. Import and customs duties are therefore particularly critical for staple crops, dairy products and other key farm goods that sustain rural livelihoods.
In FY 2025, India’s total agricultural exports rose to over USD 51 billion from USD 45.7 billion in 2023–24, with exports to the US accounting for around USD 5 billion. India’s total exports in FY25 stood at USD 437 billion.
India aims to achieve USD 100 billion in combined exports of agriculture, marine products, food and beverages over the next four years. Major exports include tea, coffee, rice, cereals, spices, cashew, oil meals, oilseeds, fruits and vegetables.
According to a joint statement issued by both countries, India will eliminate or reduce tariffs on a wide range of US food and agricultural products, including dried distillers’ grains, red sorghum for animal feed, tree nuts, fresh and processed fruits, soybean oil, wine, spirits and additional products.
(With inputs from PTI)