India-US Trade Deal: Government Says Farmers' Interests Are Protected as Farm Groups Raise Concerns
The Union Ministry of Commerce and Industry said that India has not compromised farmers' interests in the first phase of the India-US Bilateral Trade Agreement (BTA).
The Ministry said the final terms will give India a strong advantage over rival exporting countries in the US market, and that the public will see this once the details are released.
India is close to finalising the first phase of the deal, but it has not yet been signed. Both countries announced its framework in February 2026, which lowered US tariffs (import taxes) on most Indian goods.
The Samyukt Kisan Morcha (SKM), a coalition of more than 100 farm groups, has opposed the deal. It says India will remove or cut its high tariffs on US products such as maize, almonds, walnuts, apples and soybean oil.
Farm groups fear that subsidised US farm imports could push down crop prices in India and hurt rural incomes. They have asked for more details and plan further protests in November 2026.
The government's earlier position is that staples such as wheat, rice, maize, dairy, sugar, soybean and poultry are kept outside tariff concessions.
US Farm Bill: How America Supports Its Farmers
The Farm Bill is a large US law, passed by the US Congress (the American Parliament) about once every five years. It decides almost everything about how the US government helps its farmers and feeds its poor. It sets the rules for crop price support, crop insurance, soil and water conservation, farm loans, farm research, and food aid for low-income families. In simple words, it is America's main rulebook and budget for farming and food.
Indian farm groups fear that cheaper US farm goods such as maize, soybean oil and nuts will hurt Indian farmers. Much of this fear comes from the large support US farmers receive through the Farm Bill and related laws. This is why the government is stressing that sensitive crops and dairy remain protected in the India-US deal.
India-US Bilateral Trade Agreement (BTA)
The India-US Bilateral Trade Agreement (BTA) is a trade deal that India and the US are negotiating in stages, starting with a smaller interim agreement. It aims to cut tariffs and other trade hurdles so each country can sell more to the other. Agriculture and dairy have been the hardest parts of the talks, because India has millions of small farmers while the US is a large farm exporter.
The government says the deal keeps India's sensitive farm sectors safe. Farm groups say the cuts on items like nuts, apples and soybean oil will still hurt some farmers. This gap between the two views is why farmers' groups want the full text made public before signing.
Sensitive Sector Protection in Trade Agreements
In every trade deal, each country keeps a list of products on which it does not cut import taxes, or cuts them only a little. These are called sensitive sectors. They are usually products on which millions of small producers depend. For India, dairy is the most sensitive sector, followed by staples like rice, wheat and sugar.
The government's statement that farmers' interests are protected rests on these tools: staples and dairy are kept out, and sensitive fruits like apples come in only under a quota. Farm groups argue that the items that are opened, such as nuts and soybean oil, still matter to some Indian growers.
Comparative Advantage: Ricardo's Theory of International Trade
Comparative advantage is the idea that a country gains most by producing and exporting goods it can make at a lower opportunity cost (what it gives up to make them) than other countries, and importing the rest. It was explained by the British economist David Ricardo in 1817. It shows that even if one country is better at making everything, both sides still gain from trade if each focuses on what it is relatively best at.
The government says the final deal will give India a "strong comparative advantage". In practice, this means Indian labour-heavy exports should face lower US tariffs than those of rival countries. Combined with India's natural strength in such goods, this could help Indian exporters win more US orders.
- India-US BTA first phase: declared finalised on 15 October 2026; still unsigned as of late October 2026
- Interim framework announced: 6 February 2026; US reciprocal tariff of 18% on many Indian goods
- Kept protected by India: wheat, rice, maize, dairy, sugar, soybean, poultry, ethanol, tobacco; no GM farm imports
- Opened by India (as per framework): tree nuts, some fruits, soybean oil, wine and spirits, DDGs and red sorghum; apples under a tariff-rate quota
- Samyukt Kisan Morcha: coalition of more than 100 farm groups; protests planned for November 2026
- India: world's largest milk producer, about 247.87 million tonnes (2024-25)
- India's average landholding: 1.08 hectares (Agriculture Census 2015-16); US average farm: 463 acres (2022)
- US Farm Bill: first in 1933; 2018 law extended to 30 September 2026; new House bill (H.R. 7567) passed 30 April 2026
- WTO de minimis farm support limit: 5% (developed), 10% (developing)