NITI Aayog suggests ‘dual-track approach’ in India-US agri trade

NITI Aayog has said that India should adopt dual-track approach and selectively reduce high tariffs on non-sensitive agricultural commodities imports from the US, while also strategically offer concessions where domestic supply gaps exist. This assumes significant as it has come when both countries are trying to finalise a bilateral agreement.

“A dual-track approach is essential now. In the short term, India should consider to selectively reduce high tariffs on non-sensitive imports and negotiate non-tariff safeguards on vulnerable segments such as poultry,” said the Aayog in a working paper, titled — Promoting India-US Agricultural Trade Under the New US Trade Regime.

It noted that sudden announcement of “reciprocal tariffs” and enhanced market access for US exports following re-election of Donald Trump as President of the United States have sent shock waves across the world especially among the trading partners of the US.

“India can also strategically offer concessions where domestic supply gaps exist, such as in edible oils and nuts,” the paper said adding India’s agricultural sector needs safeguards, to ensure price stability for both producers and consumers, against excessive volatility in international markets.

Noting that India is the largest importer of edible oil in the world and the US has huge export surplus of soybean which is GM, the paper said India can offer some concession to the US in import of soybean oil to meet demands in that country and reduce trade imbalance, without harming domestic production.

The government has already reduced the import duty on crude form of edible oil, including soyabean oil, to 16.5 per cent from 27.5 per cent earlier.

The paper also suggested that India should negotiate more access to the US market for high-performing exports like shrimp, fish, spices, rice, tea, coffee, rubber. India’s annual agri-export to the US is about $ 5.75 billion. Expanding this through duty waivers or TRQs should be part of trade talks, the Niti paper said.

Further, India must undertake medium-term structural reforms to improve the global competitiveness of its farm sector alongside strategic trade management, it said. Bridging the productivity gap by embracing appropriate technologies, market reforms, private sector participation, improvement in logistics and development of competitive value chains are some of the reforms suggested by the Aayog.

Though traditional items such as frozen shrimp, basmati rice, and spices continue to dominate India’s export to the US, shipments of processed cereals, and other value-added products are also rising in recent times as India is diversifying the farm export portfolio. India has maintained surplus in agriculture trade with the US.

India’s imports from the US remain concentrated in high-value commodities such as almonds, pistachios and walnuts.

Published on June 3, 2025