Has India agreed to erase its red lines – protections for the dairy and agriculture sectors – in the trade deal announced by US President Donald Trump on Monday night?
That emerged as the biggest question on Tuesday morning, with the Opposition frying foul even as cheers rose from the stock markets, India Inc and export-oriented sectors over the deal that will cut US tariffs on Indian goods to 18 per cent from the 25 per cent.
The fine print of the deal is unclear. No details have been announced at the time of writing this article.
Reuters on Tuesday morning quoted an unnamed Indian official as saying that Delhi has agreed to “partly” open the heavily guarded agriculture sector to the US.
The Indian government official, who did not want to be named, said India has agreed to buy US goods including telecom and pharmaceuticals and offered market access for some agricultural products, as part of New Delhi's commitments under the deal, per the Reuters report.
India recently offered select market access for agricultural products to the European Union under a trade deal, the news agency said, adding that Delhi has also lowered tariffs on imported cars to address Washington's immediate US demands to conclude the first tranche of the deal.
The commerce ministry did not immediately reply to a Reuters e-mail seeking comment.
“The commitment to buy US products covers sectors like pharmaceuticals, telecom, defence, petroleum and aircraft. It will be done over the years,” the official told Reuters.
The official also said a more comprehensive pact with the US will be negotiated over the coming months.
The news channel CNN-News 18, however, cited unnamed “government sources” to declare that there would be no compromise on the farm and dairy sectors.
The New York Times said the details of the deal were unclear.
“Key terms remained murky, including Trump’s claim that India agreed to spend $500 billion in the United States, something the Indian side did not immediately mention,” the NYT report said.
The report mentions the tricky dairy sector that India is averse to open.
“To use one charged example, American dairy products, produced by cows with nonvegetarian diets, would send India’s consumers into an uproar, not to mention what it would do to the 70 million Indians who depend on dairy production for earnings,” NYT wrote.
Nisha Biswal, a partner at the Asia Group who formerly worked for the US International Development Finance Corporation, told the newspaper: “Corn and ethanol were areas that we had heard the Indians might be ready to make some accommodations on.”
Among those in India who questioned the nature of the US-India deal was former Rajya Sabha MP and retired bureaucrat Jawhar Sircar.
“Has Modi committed to buy US products of $500 billion (Rs. 45.5 lakh crore) when we actually buy $40-45 billion per year? How? It’s impossible in one or two or three years,” Sircar asked. “Do we have to reduce relations with age-old friend Russia? And depend only on US arms and aircraft suppliers?”
India’s exports to the US rose 15.88 per cent year-on-year to $85.5 billion in January-November, while imports stood at $46.08 billion.
“Our budget expenditure for 2026-27 is Rs. 53.5 lakh crore in total – all put together. Does it mean India has committed about 85 per cent of its total budget only on goods from America? Or some 30 per cent of our annual budget for the next three years to import American merchandise,” Sircar said, adding that the Indian government should clarify.
He said that if India has agreed to cheap US maize, cotton, soya bean, it would devastate India’s farmers and producers.
“Have we surrendered our age-old opposition to Genetically Modified crops that harm our farmers? Are we surrendering to the US GM,” Sircar asked.
A senior Indian government official told The Telegraph Online on strict condition of anonymity that “most items on the deal had been proposed a long time ago.”
(with inputs from Reuters)