Potential Impact of India-US Trade Deal on Dairy and Economic Sectors
Sourse: dairynews.today
India faces significant economic and livelihood implications with a proposed trade deal with the USA, potentially affecting dairy prices and import demands.
The proposed trade deal between India and the United States could have profound effects on the Indian dairy sector. Milk prices in India may drop by at least 15%, potentially causing an annual loss of Rs 1.03 lakh crore to dairy farmers and increasing milk imports by 25 million tonnes.
The State Bank of India (SBI) report highlights the economic ramifications, where the total revenue loss could reach Rs 1.8 lakh crore, with farmers bearing 60% of the impact. This price reduction is expected to result in increased demand by 14 million tonnes while supply decreases by 11 million tonnes, necessitating substantial imports.
The agreement could severely threaten the livelihoods of small-scale Indian farmers due to the U.S.'s heavily subsidized dairy sector. Further complications arise from the use of growth hormones and genetically modified organisms (GMOs) in U.S. dairy products, raising public health concerns.
While challenges persist, the trade deal presents opportunities for India. The country could capture a share of the chemicals and apparel export market in the U.S. from countries like Japan, Malaysia, and South Korea, potentially adding 0.1% to its GDP. Expanding exports of high-value agricultural products, organic foods, and spices could exploit the growing U.S. demand, with potential increases from less than $1 billion to over $3 billion. Relaxation of non-tariff barriers could also boost exports of Ayush and generics by $1-2 billion, while easing visa norms might further enhance exports of IT and services.
The State Bank of India (SBI) report highlights the economic ramifications, where the total revenue loss could reach Rs 1.8 lakh crore, with farmers bearing 60% of the impact. This price reduction is expected to result in increased demand by 14 million tonnes while supply decreases by 11 million tonnes, necessitating substantial imports.
The agreement could severely threaten the livelihoods of small-scale Indian farmers due to the U.S.'s heavily subsidized dairy sector. Further complications arise from the use of growth hormones and genetically modified organisms (GMOs) in U.S. dairy products, raising public health concerns.
While challenges persist, the trade deal presents opportunities for India. The country could capture a share of the chemicals and apparel export market in the U.S. from countries like Japan, Malaysia, and South Korea, potentially adding 0.1% to its GDP. Expanding exports of high-value agricultural products, organic foods, and spices could exploit the growing U.S. demand, with potential increases from less than $1 billion to over $3 billion. Relaxation of non-tariff barriers could also boost exports of Ayush and generics by $1-2 billion, while easing visa norms might further enhance exports of IT and services.
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