GTRI Warns Against Hasty Tariff Cuts in Proposed India-US Trade Deal

GTRI cautions against tariff reductions on farm products in the proposed India-US trade deal, highlighting risks to Indian farmers and market stability. Key concerns include subsidized US imports and the erosion of tariff flexibility. Critics urge a thorough review before negotiations proceed, warning of potential adverse impacts.

In what could be a pivotal turning point for agricultural trade negotiations between India and the United States, the Global Trade Research Initiative (GTRI) has voiced strong concerns over possible tariff reductions on farm products. The organization emphasizes the need for careful consideration of the repercussions that opening Indian markets to subsidized American farm products could entail.

According to a Niti Aayog working paper from May 2025, there is a proposal to open Indian markets to a variety of U.S. farm products under a new trade regime. This includes major agricultural commodities such as rice, pepper, and soybean oil. Despite these recommendations, GTRI argues that subsidies on American and European products have previously disrupted global grain prices, potentially affecting Indian farmers' livelihoods.

Ajay Srivastava, founder of GTRI, underscores the importance of maintaining tariff flexibility as a means to safeguard against market shocks and protect food security. He points to past experiences of zero tariff bindings, which have made renegotiations costly for India. The debate over import policies is further complicated by issues around GM products and U.S. demands regarding dairy and poultry product regulations.

(With inputs from agencies.)