Escaping the Trawl

Developed nations like the USA have been using subsidies and non-tariff barriers to shield their agricultural sector, which restricts exports from developing countries. India must push for WTO reforms while reassessing bilateral trade deals, and reconsidering multilateral alternatives like BRI

- DIPANKAR DEY

The Indian Prime Minister and the President of the USA in a joint statement on February 13, 2025, announced, "Mission 500", which aims at USD 500 billion in bilateral trade by 2030. According to the website of the US Trade Representative (USTR), America's total goods trade with India was estimated at USD 129.2 billion in 2024. The trade deficit between the two countries in 2023-24 was USD 35.3 billion in India's favour. Trade negotiations between India and the USA have already started.

The emphasis of the talks right now is to prepare lists for "early harvest", and a roadmap to conclude a bilateral trade agreement (BTA) by the fall of 2025. Agricultural produce has emerged as one of the key focus areas of the ongoing discussions between India and the US for a trade deal.

Last week, US Commerce Secretary, Howard Lutnick, called upon India to open up the agricultural sector for trade, saying "it just can't stay closed". He repeatedly called for a bilateral deal, arguing that a pact "with the largest consuming economy in the world" would be beneficial. Lutnick sought a "grand deal", saying, "Let's bring India's tariff policy towards America down, and America will invite India to have an extraordinary opportunity and relationship with us." The terms "large" and "grand" bilateral trade agreement is usually used while seeking to negotiate a comprehensive trade agreement covering all key aspects, rather than engaging in sector-specific discussions.

Lutnick's statement has created apprehension among Indian policymakers because further than tariff reductions, the US may like to include provisions on government procurement, agricultural subsidies, patent law relaxation, and unrestricted data flows issues that India has largely opposed for decades.