Delhi trade talks progress despite major resistance on US farm products.
The India US trade deal negotiations are ongoing, with the United States acknowledging a significant, yet challenging, advancement from the Indian side. While in Washington DC, United States Trade Representative (USTR) Jamieson Greer described India’s latest proposal as the "best ever" offer received by the US, simultaneously noting that India has been a "difficult nut to crack" regarding certain agricultural imports.
Greer’s statement to the US Senate Appropriations Committee came as US negotiators kicked off a two-day round of discussions in New Delhi. He specifically referenced India’s strong reluctance to permit American-grown row crops and various meat products into its market, a stance maintained to protect India’s vast community of small farmers from foreign competition. The US, conversely, has been keen to diversify its agricultural exports—including products like soybeans and corn—away from its heavy reliance on the Chinese market. Earlier disagreements over agricultural access had actually caused a previous round of talks to collapse.
Adding to the complexity, US President Donald Trump recently threatened to impose fresh tariffs on Indian rice. This threat followed concerns raised by a US farmer representative about India, China, and Thailand "dumping" rice into the US market. Trump singled out India, questioning the country's exemption (if any) from tariffs on rice and asserting that tariffs could quickly resolve the issue. This comes on top of the 50 percent tariffs the US has already imposed on New Delhi, which are the highest globally for any country.
Amidst these trade pressures, Prime Minister Narendra Modi has publicly affirmed that India will not compromise the welfare of its farmers, fisherfolk, and cattle keepers. This commitment directly relates to the standoff over market access for American dairy and agricultural products.
A potential breakthrough, according to Greer, could involve the use of imported US soybeans for biofuels. India has historically resisted genetically modified (GM) products, but allowing soybean imports for industrial use could pave the way for a broader agreement. The US has already dropped reciprocal tariffs on certain products like coffee, tea, and tropical fruits in a move to help contain domestic inflation, indicating a willingness to ease trade tensions.
The US has long cited India’s agricultural support programs and its strict, culturally-rooted restrictions on dairy import restrictions as major obstacles. India’s food safety regulations require certifications that US exporters find difficult to meet. Although allowing US dairy entry could enhance consumer choice, Indian authorities insist these barriers are necessary to align with cultural norms and, critically, to safeguard the livelihoods of the domestic, cooperative-based dairy sector, which is the largest in the world.
