New Delhi: Ashok Gulati, a prominent Indian agricultural economist and professor at the Indian Council for Research on International Economic Relations (ICRIER), has indicated that India is not expected to suffer significant losses in its agricultural exports as a result of the new tariffs introduced by US President Donald Trump.
He emphasized that with strategic negotiations during bilateral trade discussions with the US, India could potentially enhance its position.
Gulati remarked, "If rival nations are subjected to lower tariffs than India, it could lead to a decline in India's exports for those specific products. However, overall, it appears that India may not experience substantial losses in agriculture. With astute negotiations in the BTA, we could see gains."
He further clarified that the effects of these tariffs will vary across different agricultural products. The ultimate impact will depend on several factors, including the tariff rates imposed by the US on India compared to those on competing nations.
According to the new policy, Indian agricultural exports to the US are currently facing a 27 percent tariff, as outlined in the trade document. However, the crucial aspect is how these tariffs stack up against those levied on countries that compete with India in similar product categories.
For instance, in the case of rice, if Indian rice incurs a 26 percent tariff while competitors like Vietnam and Thailand face even steeper duties, India could stand to gain. Conversely, if those countries are subjected to lower tariffs, India may lose its market share in the US.
Gulati concluded, "The effects of Trump's tariff policy will differ significantly across various agricultural commodities. To accurately assess the potential impact, one must consider not only the tariff rate on Indian exports (26 percent) but also the rates imposed on exports from competing countries to the US."
Gulati highlighted that the essence of success is found in strategic negotiation. He noted that if India can secure a beneficial bilateral trade agreement (BTA) with the US, it could potentially transform the tariff issue into a chance for growth. "In general, it appears that India may not suffer significant losses in agriculture," he stated. "However, with astute negotiation in the BTA, we could achieve gains."
