India's trade deal with the US: What about agri divergences?

It's good news for India though we await details on sticky points

- ANDY MUKHERJEE

Deal success: Modi and Trump both have reason to smile.

(PTI)

After more than five months in US President Donald Trump’s tariff prison, India is finally free.

The punitive 50% duty that was threatening its manufacturing industries will fall to 18%, a tad better than key rival Vietnam's 20%. It's also a discount on the 26% reciprocal rate Trump had announced for India last April. Overall, this is a great moment for Prime Minister Narendra Modi.

But before celebrations begin in New Delhi, the deal announced on social media by Trump and confirmed by Modi needs signatures. It also needs clarity about what the two leaders have actually agreed to. For India, the threat of losing access to its biggest export market hasn't been an entirely bad thing. The isolationism hubris that had crept into New Delhi’s approach to global trade has received a welcome jolt. The pressure from domestic industry to find alternatives to the American consumer has led to separate trade accords with the UK and EU. The latter pact will dismantle some of India’s more egregious non-tariff walls—built around quality control.

Modi has also started mending ties with China’s President Xi Jinping, frayed since the eruption of border hostilities in 2020 and aggravated by Chinese military support of Islamabad during last year’s conflict between India and Pakistan.