India-US Trade Talks Hinge on Dairy Sector Disagreements

The upcoming India-US trade negotiations, scheduled for January 13, continue to highlight the dairy sector as a major point of contention. The discussions aim to advance a comprehensive bilateral trade agreement, but the sensitivity surrounding agricultural and dairy issues poses significant challenges.

U.S. Ambassador to India Sergio Gor emphasized the ongoing commitment of both nations to these talks, noting the importance of maintaining dialogue despite disagreements. The United States seeks reduced import duties and increased market access for American agricultural products, including dairy.

India remains cautious, particularly regarding agriculture and dairy, due to concerns about the impact of opening domestic markets to subsidized U.S. products. Indian policymakers stress that these sectors are vital for the livelihoods of many smallholders and rural households.

The dairy sector, dominated by small and marginal farmers, operates predominantly within cooperative systems. Lowering tariffs on imported dairy products could subject Indian producers to increased competition and price volatility.

Beyond agriculture, the trade discussions cover other sectors where India seeks reciprocal tariff reductions, including textiles and automotive components. Regulatory issues, such as food safety standards and intellectual property protections, also remain unresolved.

The negotiations underscore the complexity of balancing trade liberalization with the need to protect domestic industries and ensure economic stability, highlighting the intricate path ahead for both nations.