Kerala's Farmers at Risk: Centre's Trade Agreement with US Poses Threat to Livelihood of Lakhs

Strategic Insights -

The livelihood of lakhs of Kerala's rubber, coconut, dairy, and poultry farmers hangs in the balance as the Centre negotiates a trade agreement with the US. Kerala's Agriculture Minister, P Prasad, warned that the agreement could harm the state's agriculture sector, particularly coconut farmers, if the Centre fails to protect Indian farmers' interests. The agreement, expected to be finalised soon, proposes to partially open India's agricultural sectors, allowing genetically modified (GM) products and imports of cheaper US soybean oil, which could destabilise Kerala's coconut oil market.

Key Takeaways:

  • The Centre's trade agreement with the US poses a significant threat to the livelihood of lakhs of Kerala's farmers involved in rubber, coconut, dairy, and poultry farming.
  • Kerala's Agriculture Minister, P Prasad, has expressed concerns that the agreement could greatly harm the state's agriculture sector, particularly coconut farmers, due to higher imports of soybean oil.
  • The minister warned that lakhs of farmers involved in natural and organic farming are particularly vulnerable to the entry of GM products.
  • The proposed Free Trade Agreement (FTA) with the US could dismantle local production systems, expose farmers to unfair competition, and harm Kerala's farmers' income.
  • Kerala's agriculture, centered on cash crops such as coconut, rubber, pepper, cardamom, tea, and coffee, supports millions of smallholder farmers.
  • The Centre's proposed tariff reductions would expose Kerala's farmers to unfair competition, making it difficult for them to compete with cheaper imports from the US.
  • Kerala's Minister for Agriculture expressed concerns that the Centre is not consulting with the states before negotiating the opening of the agriculture sector, which is a state subject.

Statistics:

  • Lakhs of farmers are involved in rubber, coconut, dairy, and poultry farming in Kerala.
  • The US subsidises soybean oil with over 80 percent of production value for certain commodities.
  • Kerala's coconut oil market could be destabilised by cheaper US soybean oil imports.
  • The state's natural rubber farmers would be severely impacted by low-cost synthetic rubber imports.
  • Kerala's agriculture supports millions of smallholder farmers.
  • India's tariff structure ranges from 0 percent to 150 percent.
  • The US uses steep duties, such as 350 percent on tobacco, to shield its farm sector.
  • Over 700 million people depend on India's smallholder-dominated agricultural system.

Sources:

  • The Indian Express
  • P Prasad, Kerala's Minister for Agriculture
  • Commerce and Industry Minister Piyush Goyal
  • NITI Aayog