In a significant development, India’s agricultural sector may see some advantages as the United States removes specific agricultural products from its reciprocal tariff list, according to a report by the Global Trade Research Initiative (GTRI). The lifting of these tariffs, initially enacted earlier this year, means that the products will now be subject only to standard Most Favored Nation (MFN) duties.
The White House issued an Executive Order on November 12, excluding items such as coffee, tea, tropical fruits, fruit juices, cocoa, spices, bananas, oranges, tomatoes, beef, and specific fertilizers from the tariff regime that had been in place since April 2. The GTRI report published on Saturday highlights that these exemptions, effective November 13, pertain to goods that are either inadequately produced within the US or require specific climate conditions that the US cannot meet.
Despite the potential opening in the US market, India’s current export contribution in these categories remains relatively limited, amounting to just USD 548 million within America’s USD 50.6-billion import basket. Indian exports are primarily focused on high-value spices and niche products such as pepper, ginger, turmeric, and tea. However, India lacks a significant presence in other major exempted lines, including citrus fruits and tomatoes. For India to capitalize on this opportunity, strategic expansions in scale, development of a robust cold-chain infrastructure, and diversification of export offerings will be essential, concluded GTRI.
(With inputs from agencies.)