India US Trade Deal : In its factsheet on the “key terms” of the “historic” India-US trade agreement, the U.S. administration of Donald Trump has changed the language regarding the $500 billion purchase “commitment” and removed the assertion that New Delhi would lower tariffs on “certain pulses,” among other things.
Since India’s farm economy is sensitive to agricultural imports, especially pulses, the factsheet’s adjustments are noteworthy.
India US Trade Deal : Pulses Revision
The White House produced a factsheet on Tuesday that specifically named “certain pulses” as products for which India would lower or eliminate tariffs. “India will eliminate or reduce tariffs on all US industrial goods and a wide range of US food and agricultural products, including dried distillers’ grains (DDGs), red sorghum, tree nuts, fresh and processed fruit, certain pulses, soybean oil, wine and spirits, and additional products,” according to the statement.
The amended paper makes no mention of pulses. The statement reads: “India will eliminate or reduce tariffs on all US industrial goods and a wide range of US food and agricultural products, including dried distillers’ grains (DDGs), red sorghum, tree nuts, fresh and processed fruit, soybean oil, wine and spirits, and additional products.”
India is the world’s largest producer and consumer of pulses such lentils, chickpeas, and dry beans. To protect the interests of Indian farmers, New Delhi has put steep tariffs on American exports in several areas. The modification in the US factsheet shows that New Delhi successfully fought back against the description.
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“Agri Goods” was removed.
The Trump administration has also deleted the reference to agricultural items from the text. It also changed its language to reflect President Trump’s remark about India’s “commitment” to purchasing over $500 billion in US goods.
However, the amended paragraph makes no mention of agricultural products. It also replaced the term “committed” with “intends.”
The updated version stated: “India intends to buy more American products and purchase over $500 billion of US energy, information and communication technology, coal, and other products.”
The politically sensitive agriculture industry accounts for around one-fifth of India’s GDP. According to a June report by McKinsey & Co., the country’s agricultural sector is valued $580 billion to $650 billion and has the potential to rise to $1.4 trillion by 2035.
New Delhi has opposed expanding its agriculture industry due to concerns that the move will put more pressure on some domestic farmers in the highly competitive market.
No Removal of Digital Services Taxes
Team Trump also retracted claims that India will eliminate digital services tariffs. The original text said: “India will remove its digital services taxes and committed to negotiate a robust set of bilateral digital trade rules that address discriminatory or burdensome practices and other barriers to digital trade, including rules that prohibit the imposition of customs duties on electronic transmissions.”
What Caused The Changes
The modifications came a day after Congress President Mallikarjun Kharge criticized the Bharatiya Janata Party (BJP) government at the Centre for the structure of the Interim Trade Agreement with Washington. Kharge said that the trade agreement damaged India’s strategic autonomy, farmers, cattle, and the textile industry.
He dubbed the agreement a “PR-wrapped betrayal” and questioned whether it serves India’s strategic and economic interests. The Congress leader expressed concerns about agriculture, claiming that pulses and genetically modified (GM) feed, such as dried distillers’ grains (DDGs) and red sorghum for animal feed, had been quietly incorporated to the agreement.
India’s Stand So Far
After the arrangement was announced, the Centre assured Indian farmers that they would be totally protected. According to Commerce Minister Piyush Goyal, the farm sector has not been fully opened, and India’s self-sufficient sectors have been excluded from the pact.”I can say with absolute certainty that our farmers, artisans, and handloom industry will not suffer any harm,” Goyal said at a press briefing, calling the trade deal as “fair, equitable, and balanced.”
No concessions have been made on sensitive commodities in India, he continued.
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