Trade Deal with US Hits Hurdle Over Lower-Duty Import of American Agricultural Products

Strategic Insights -

India's resistance to lowering duty on American agricultural products has stalled the proposed trade deal with the US. The country is concerned about adverse impact on farmers and health concerns related to genetically-modified food. Domestically, the industry is preparing for a 26% levy, which is expected to come into effect if no limited deal is reached before the July 9 deadline.

Key Takeaways:

  • The proposed trade deal has hit a hurdle over India's refusal to lower duty on American agricultural products such as maize and soybean.
  • Indian authorities are concerned about the adverse impact on farmers and health concerns related to genetically-modified food.
  • The US is keen on allowing lower-duty import of American agricultural products, but India is resisting, citing concerns over the impact on farmers and health.
  • The government is preparing for a 26% levy on American agricultural products if no limited deal is reached before the July 9 deadline.
  • The US has indicated its reluctance to certify non-GM grade produce, suggesting processing American maize into ethanol or soybean into oil instead.
  • The US is also pushing for several of its other products, including automobiles, to be allowed to be imported at low duty.

Statistics:

  • 26% levy on American agricultural products if no limited deal is reached before the July 9 deadline.
  • 10% baseline tariff applicable to all countries offered by the Trump administration, which is not considered good enough by the Indian government.
  • 140 crore consumers in the US market, which India is concerned about opening doors to.
  • Crores of farmers in India who are concerned about the impact of genetically-modified food on their livelihoods.

Sources:

  • Sources within the Indian government, as acknowledged by Times of India.
  • Donald Trump, US President, as mentioned in the article.
  • Narendra Modi, Prime Minister of India, as mentioned in the article.
  • Times of India.
  • Unnamed sources within the Indian government, as cited by Times of India.