‘India’s food security at risk’: Why GTRI opposes import duty cut on US farm goods

India should retain its policy space in the agriculture sector under the proposed trade agreement with the US, the Global Trade Research Initiative (GTRI) said on Monday.

Any reduction in the import duties on American farm goods could compromise the country's food security, the think tank said.

Threat of subsidised imports

GTRI highlights that US agricultural products like rice, dairy, poultry and genetically modified soy benefit from deep subsidies, which gives them an unfair advantage over Indian producers.

The body warns that such imports, if allowed with lower tariffs, could harm over 700 million rural livelihoods, especially during global price crashes, citing such cases, PTI reported.

Speaking of historical data, it said that between 2014 and 2016, global grain prices collapsed -- wheat dropped below $160 per tonne wiping out farmers across Africa.

If India removes tariffs, cheap, subsidised US grains could similarly flood Indian markets during global price crashes, the think tank cautioned.

Protecting India’s agri industry

GTRI founder Ajay Srivastava said that India's dairy import restrictions, such as the requirement that animals not be fed meat, blood, or internal organs of other animals, block US dairy access.

However, the US sees this as too strict, but imagine eating butter made from the milk of a cow that was fed meat and blood from another cow, he said.

"India may never allow that. India's dairy sector is built on millions of smallholders with one or two cows or buffaloes. Opening it to subsidised US imports could destroy livelihoods," Srivastava said.

Similarly, poultry imports, if eased, would affect local producers.

Public opposition to GM foods

The US also criticises India's rules on genetically modified (GM) food as unclear and not science-based, which makes it hard for American biotech exports to reach India.

"India, however, is cautious due to strong public opposition to GM foods and concerns about environmental risks. It also notes that major regions like the EU are GM-free, and adopting GM crops could affect soil health and hurt India's exports," he added.

He further said that India's loose supply chains mean GM traits could easily leak into domestic systems, contaminating local crops and hurting exports to GM-sensitive markets.

Massive subsidies give US an edge

Further, he said that US agricultural exports are propped up by massive subsidies.

In some years, these subsidies exceeded 50 per cent of production value. Some instances are rice (87 per cent), cotton (74 per cent), canola (61 per cent) and wool (215 per cent).

Products benefiting from such subsidies are apples, almonds, corn, dairy, poultry, and ethanol, all of which the US is keen to sell to India.

Unlike the US, where agriculture is corporatised, Indian farming is a livelihood issue, and hence tariffs are essential to protect small farmers, manage price differences, and ensure food security of the country, the news agency reported.