Is India opening its agriculture sector to US firms?:Why is opposition raising red flag over trade deal with Washington?

President Donald Trump this week announced that India and the US have agreed to a trade deal, raising expectations of an early closure of negotiations that continued for months. The government still faces strong opposition despite its assurance that Indian farmers will be protected. One major bone of contention has been the opening of the Indian market to American farm produce, which some commentators believe would make domestic producers less competitive and vulnerable to mass-produced high-tech imports from the US. New Delhi has its own red lines when it comes to protecting farmers, who make up a major pressure group in India. The deal’s announcement came following a phone call between Modi and Trump. Taking to his social media platform, Truth Social, Trump said: “We agreed to a Trade Deal between the United States and India, whereby the United States will charge a reduced Reciprocal Tariff, lowering it from 25% to 18%.” “They will likewise move forward to reduce their Tariffs and Non-Tariff Barriers against the United States to ZERO,” Trump said in his post. The opposition parties and their leaders, such as Manish Tewari (Congress) and Priyanka Chaturvedi, MP, Shiv Sena (UBT), raised serious concerns over the trade deal with the US, especially regarding the opening of the agriculture sector, which has been protected so far. We unpack why the agro sector is important and how the India-US deal is likely to affect Indian farmers in today’s explainer… Why has agriculture been protected so far from foreign trade?
Agriculture has long been one of the toughest fault lines in US-India trade negotiations.
Washington has repeatedly pushed New Delhi to open its market to genetically modified crops from the US, a politically sensitive issue for Prime Minister Narendra Modi.
Nearly half of India’s 1.4 billion population still depends on agriculture for livelihood, prompting the government to shield the sector from foreign competition to protect farmers.
Farmer resistance has also posed one of the most persistent political challenges to Modi since he took office in 2014.
Protests against proposed farm laws eventually forced the government to repeal them, marking a rare retreat in the face of sustained dissent.
Amid mounting US pressure during trade talks, Modi said in August he was prepared to pay a personal “price” to safeguard farmers’ interests.
“For us, the welfare of our farmers is the highest priority. Bharat will never compromise on the interests of its farmers, dairy farmers and fishermen,” he said. Is India opening its agriculture sector?
There is no official information from the Ministry of Commerce on the issue. However, in his trade deal announcement, Trump did mention that the Prime Minister (Modi) committed to ‘BUY AMERICAN’ at a much higher level, in addition to over $500 billion in US energy, technology, agriculture, coal, and other products.
On Monday, US Agriculture Secretary Brooke Rollins said the new US-India trade deal would expand exports of American farm products into India’s vast market, boosting prices and incomes for rural America.
She noted that the US ran an agricultural trade deficit of $1.3 billion with India in 2024 and said the agreement would help narrow that gap.
However, during a press conference, Commerce Minister Piyush Goyal hinted that India would protect sensitive sectors, i.e., agriculture and the dairy market.
US Trade Representative Jamieson Greer said on Tuesday that the Trump administration is in the process of formally finalising the trade agreement announced with India. He said the details of the deal are already settled, even as documentation is being completed.
Speaking to CNBC, Greer said, “We’ll finish papering it, but we know the specifics, we know the details.”
He added that India “is maintaining some protection around agricultural goods” as the wider agreement moves forward. Which agro products does the US want to send to India?
Trump wants greater market access for American corn, ethanol and soybeans, or relaxed restrictions with regard to imports of genetically modified produce and dairy products. What are genetically modified (GM) seeds?
Genetically Modified Organism (GMO) seeds are plants or organisms whose DNA or genes are modified to produce the desired changes. Why is politics brewing over the deal?
There are no details available about the deal, but politics has already started over it.
Addressing a press conference on the deal, Union Commerce Minister Piyush Goyal said:
“It will protect the sensitive sectors – the interests of our agriculture and our dairy sectors.”
“It will open up huge opportunities for our labour-intensive sectors and export sectors. This is truly a deal every Indian can be proud of.” The opposition launched an attack on the government over the deal during the Budget Session of Parliament and demanded details of the agreement reached.
“The main thing is that our PM is compromised. The public needs to think about this. Narendra Modi ji has sold your hard work in this trade deal because he is compromised. He has sold the country,” said Rahul Gandhi, the Leader of the Opposition in the Indian Parliament.
Shiv Sena (UBT) MP Priyanka Chaturvedi flagged concerns over the India-US trade deal and said it was “not a win-win situation.” Is India now in a more advantageous position in trade with the US?
At first glance, the 18% US tariff on Indian goods appears to put India at an advantage over regional competitors such as Pakistan (19%), Bangladesh and Vietnam (20%), and China (34%).
However, most of India’s neighbours continue to benefit from the US Generalized System of Preferences (GSP), which allows duty-free access for certain products from developing economies to boost their exports.
India, once the largest beneficiary of the scheme, was removed from the GSP list in 2019 following trade frictions, as New Delhi pushed back against US demands to further open its markets. Graphics: Anas Shakir