US farm exports to India surged, even with no deal, Pg16

Key Highlights:

• US agricultural exports to India surged by 34.1% to $2.85 billion during January-November 2025 compared to $2.13 billion in the same period in 2024.
• The US agricultural trade deficit with India decreased from $3.5 billion to $3.1 billion during the same period.
• Key drivers of US exports to India include tree nuts, cotton, and soyabean oil.
• India allowed duty-free imports of cotton from August 18 to December 31, 2025, benefiting US exports.
• India reduced its effective import duty on crude soyabean oil from 27.5% to 16.5% effective May 31, 2025, boosting US exports.

Detailed Insights:

• US Secretary of Agriculture claimed a trade deal would increase US farm product exports to India and reduce the US agricultural trade deficit, which she stated was $1.3 billion in 2024, while actual data indicated $3.8 billion.
• Despite no formal trade agreement, US agricultural exports to India have already been increasing, driven by tree nuts like almonds and pistachios, as well as cotton and soyabean oil.
• India's Commerce Minister stated that India has protected its sensitive agriculture and dairy sectors in trade negotiations with the US.
• The US has been advocating for India to allow imports of ethanol for blending with petrol and diesel, but India has resisted to protect its domestic biofuel program utilizing sugarcane, maize, and rice.
• Indian agricultural exports to the US experienced growth in the first half of 2025, but declined during July-November 2025 due to 50% tariffs imposed by the US.
• The proposed reduction of US tariffs on Indian goods to 18% is expected to help India regain some of its lost export market share.

Key Concepts Involved:

• Tariff: A tax or duty imposed on goods when they are moved across a political boundary.
• Trade Deficit: The amount by which the cost of a country's imports exceeds the value of its exports.
• Non-tariff Barriers: Trade barriers that restrict imports or exports of goods or services through mechanisms other than the simple imposition of tariffs.