On February 6, the U.S. and India announced that they have reached a framework for an interim reciprocal trade agreement which lists tariff reductions on several products traded between the two countries. However, the announcement has raised concern among farmer groups and food security activists over potential increases in agricultural imports, including genetically modified (GM) grain.
The India-U.S. joint statement says, “India will eliminate or reduce tariffs on all U.S. industrial goods and a wide range of U.S. food and agricultural products, including dried distillers’ grains (DDGs), red sorghum for animal feed, tree nuts, fresh and processed fruit, soybean oil, wine and spirits, and additional products.” India has also agreed to address long-standing non-tariff barriers affecting U.S. food and agricultural exports, the statement says. The interim agreement serves as a stepping stone to a more comprehensive bilateral trade agreement between the two countries.
Raising concerns over the tariff concessions on U.S. agricultural products, farmer organisations have called for nationwide protests on February 12.
In a statement released on February 7, ASHA-Kisan Swaraj, a farmer network, said removal of tariffs on a wide range of agricultural imports could depress domestic prices, affect farmers and horticulturists, distort feed and livestock markets, and increase dependence on imports.
The group said imports of DDGs and red sorghum could affect farmers growing maize, jowar, and soybean used in fodder and animal feed. It also raised concerns over soybean oil imports, particularly at a time when soybean farmers are reporting distress in Maharashtra, Telangana, Madhya Pradesh, and Rajasthan.
The network also raised concerns about potential imports of GM food and feed products under the trade framework, particularly soybean oil and DDGs, which will mostly come from GM maize.
Under current regulations, the Food Safety and Standards Authority of India (FSSAI) requires imported food products linked to 24 notified crops to carry a non-GM origin and GM-free certificate. The order, released in 2020, includes maize, soybean, wheat, and a few others.
In the interim agreement, the U.S. will apply a reciprocal tariff of 18% on products like textile and apparel, leather and footwear, plastic and rubber, organic chemicals, home décor, artisanal products, and certain machinery. It has also agreed to remove tariffs on certain aircraft and aircraft parts. Besides, both countries have agreed to establish rules of origin to ensure that the agreement’s benefits predominantly flow to the United States and India.
The joint statement adds that India intends to purchase $500 billion worth of U.S. energy products, aircraft and aircraft parts, precious metals, technology products, and coking coal over the next five years.
Banner image: Farmers protest at a Delhi border in 2020. Image by Randeep Maddoke via Wikimedia Commons (CC0).