India–US Trade Deal: Dairy, Key Agri Sectors Protected, Says Piyush Goyal
- 3rd February 2026
- 06:20 PM
- 2 min read
Summary
Commerce and Industry Minister Piyush Goyal said India has safeguarded its dairy and sensitive agricultural sectors under the newly announced India–US trade deal, even as Washington cut tariffs on Indian goods to 18%. He stressed that farmer interests remain non-negotiable despite broader market access talks.Mumbai | February 3
India has ensured strong protection for its dairy and core agricultural sectors under the newly announced India–US trade agreement, Commerce and Industry Minister Piyush Goyal said on Monday, addressing concerns over market access for American farm products.
Agriculture has been a sensitive area in trade talks due to fears that cheaper, subsidised imports, especially dairy, could hurt domestic prices and farmer incomes.
Goyal clarified that while the trade deal includes “some” agricultural items, India has drawn firm red lines around sensitive areas such as dairy and key farm livelihoods. “Our farmers’ interests are paramount. Dairy and critical agri sectors remain protected,” he said, underscoring that India would not compromise on food security or rural incomes.
Agri access limited under deal
The minister’s comments come amid reports that the agreement allows selective agricultural trade, following claims from a senior aide of Donald Trump that the deal would benefit American rural farmers. Indian officials, however, indicated that the scope remains limited and carefully calibrated.
Officials added that discussions are ongoing for a more comprehensive bilateral trade arrangement, but any expansion would continue to factor in domestic sensitivities.
Tariff cut strengthens India’s export position
Under the agreement, US tariffs on Indian goods have been reduced to 18% from 25%, with the additional 25% penal levy linked to India’s purchase of Russian crude oil also being withdrawn. This effectively lowers the tariff burden from earlier peaks of nearly 50% on certain trade flows.
The revised structure gives Indian exporters a clear edge over regional peers. Indonesia faces tariffs of 19%, while Vietnam and Bangladesh remain at 20%. India’s advantage over China is more pronounced, with US tariffs on Chinese goods still at 34%.
Deal effective immediately
The agreement was announced after a phone call between Trump and Narendra Modi and is effective immediately. Modi welcomed the move, saying it would support Indian exports to the US market.
The trade reset follows months of tariff-related tensions and is expected to aid exports and sentiment, while maintaining protections for India’s agricultural and dairy sectors.
With inputs from Moneycontrol
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