While commerce minister Piyush Goyal said on Tuesday that sensitive sectors such as dairy and agri are fuly protected under the India-US trade deals, it’s still not clear which items India has agreed to provide tariff concessions for imports.
Analysts say that imposition of 50% tariff by the US have hurt Indian agri-exports in recent months and the proposed duty cut to 18% would help it recover some lost ground.
The concessions — both tariff and non-tariff — offered by India to US for agriculture imports will be known only after the details of the deals come out. It is believed that tariff rate quotas may have been offered to the US for certain items like cotton, soyabean and cotton.
However, India is expected to have persisted with its reservation about importing genetically modified soybean and maize, the two top agri-exports items for the US.
India’s present imports
At present India only allows imports of ethanol for non-fuel industrial purposes, while the US, world’s biggest producer and exporter of ethanol made from maize is pressing India to import bio-fuel for blending with petrol.
“It is good to see the end of massive uncertainty in the trade deal with the US. What we know so far is the tariffs on Indian goods will be 18% instead of 50%. That’s a big relief. But more will be seen when item wise details come out,” Ashok Gulati, agricultural economist, said.
Brooke Rollins, secretary, US agriculture in a social media post has claimed that the India-US trade deal announced Monday will result in “export of more American farm products into India’s massive market, lifting prices and pumping cash into rural America”.
US’s agricultural trade deficit
The US’s agricultural trade deficit, according to Rollins, was valued at $1.3 billion in 2024.
During January-November 2025, the US exported agricultural produce worth $2.85 billion, a 34.1% jump over the $2.13 billion during the same period last year. At the same time India’s agri products exports to the US increased by 5.1%, $5.91 billion during the first eleven months of 2025 on year.
Bilateral agri-trade between India and the US stood at around $6.6 billion in 2024. While India’s exports of agri-products consisting of marine products, spices, rice and processed food products.
Seafood, largely frozen shrimp, remains India’s largest agricultural export to the US, accounting for $2.8 billion of $7.38 billion in FY25 shipments. While the US exports of tree nuts, cotton and soybean oil has been robust, it remains to be seen what India has offered as tariff concessions especially in the corn (maize), soybean, ethanol for blending with petrol and dairy products.
India has historically kept key farm products and dairy items outside the scope of tariff liberalisation in trade deals signed with the United Kingdom, New Zealand, and the European Union (EU).
In the recent trade agreement with the EU, sensitive sectors like dairy, cereals, poultry, soymeal, certain fruits and vegetables, have been kept out of the purview of trade agreement, which the government has termed ‘balancing export growth with domestic priorities,’.
The Indian Rice Exporters Federation said that if the proposed tariff structure is confirmed, it would effectively lower India’s tariff burden to 18%, restoring parity with key competing origins such as Thailand and Pakistan, where rice shipments currently face tariffs of around 19%.
“Combined impact of lower US tariffs and rising demand is likely to benefit exporters in the coming season and provide better return to Indian farmers,” Ranjit Singh Josan, vice-president, basmati rice millers and exporters association of Punjab, told FE. Though the US is not a very large market for Indian rice exporters in terms of volume, it is a high value realisation export destination.
“The trade deal marks an important and encouraging development for India’s agricultural export sector, particularly for the basmati rice industry. The reduction in reciprocal tariffs is expected to ease export-related cost pressures and provide much-needed support to pricing competitiveness,” Akshay Gupta, head-bulk exports, KRBL, which ships basmati rice to over 90 countries under ‘India Gate’ brand, said.
India has been the largest exporter of rice for a decade now and currently has a share of over 40% in the global grain trade.