India may not lose much in agriculture due to Trump's tariffs: Economist Ashok Gulati

ANI April 4, 2025 183 views

Renowned economist Ashok Gulati offers an optimistic perspective on US tariffs' impact on Indian agriculture. He suggests that the outcome depends entirely on strategic bilateral negotiations and comparative tariff rates with competing countries. Gulati emphasizes that India could potentially turn this tariff challenge into an opportunity through smart trade talks. The key lies in understanding nuanced tariff structures across different agricultural commodities and negotiating accordingly.

"If we negotiate smartly in BTA, we may gain" - Ashok Gulati
New Delhi, April 4: Ashok Gulati, a well-known Indian agricultural economist and professor at the Indian Council for Research on International Economic Relations (ICRIER), said that India is unlikely to face major losses in its agricultural exports due to new tariffs announced by US President Donald Trump.

Key Points

1

Trump's tariffs may have varied impact on agricultural commodities

2

Strategic bilateral negotiations crucial for India's trade

3

Comparative tariff rates determine export potential

4

Competitive positioning matters more than absolute tariff levels

In fact, he stated that if India negotiates wisely during bilateral trade talks with the US, it could even gain some ground.

Gulati said, "If competing countries face lower tariffs than India, then India may lose in that product exports. Overall, it seems India may not lose much in agriculture. But if we negotiate smartly in BTA, we may gain."

Gulati also explained that the impact of these tariffs will not be the same for all agricultural products. The final outcome depends on various factors, including how the US sets tariffs on India and other competing countries.

Under the new policy, Indian agricultural exports to the US are currently subject to a 27 per cent tariff (as per the trade document). However, what really matters is how these tariffs compare with those applied to countries that compete with India in the same product segments.

For example, in the case of rice, if Indian rice is subject to a 26 per cent tariff but rice from competitors like Vietnam and Thailand face even higher duties, then India could actually benefit. On the other hand, if those countries face lower tariffs, India might lose market share in the US.

Gulati added, "The impact of Trump's tariffication is going to be quite varied across different agri-commodities. To estimate the likely impact, one needs to look at not only tariff rate on Indian exports (26 per cent), but also on the tariff rates on competing countries' exports to US."

Gulati emphasized that the key lies in strategic negotiation. If India is able to strike a favorable bilateral trade agreement (BTA) with the US, it can possibly turn the tariff challenge into an opportunity. "Overall, it seems India may not lose much in agriculture," he said. "But if we negotiate smartly in the BTA, we may gain."

Reader Comments

R
Rahul K.
Finally some positive news about trade policies! Gulati makes excellent points about relative tariffs. India should definitely focus on strategic negotiations rather than panicking. 🇮🇳
P
Priya M.
I'm not fully convinced. While Gulati's analysis is sound, we've seen how unpredictable Trump's policies can be. What if he changes tariffs again after negotiations? The uncertainty itself could hurt farmers.
S
Sanjay V.
The rice example was eye-opening! Never realized how much depends on what tariffs OTHER countries get. Hope our negotiators are paying attention to these details.
A
Ananya T.
Respectfully, I think this analysis is too optimistic. Our agricultural sector is already struggling, and even small tariff impacts could hurt small farmers. We need contingency plans.
V
Vikram J.
Gulati always provides balanced perspectives. The key takeaway: negotiation skills will make or break this situation. Time for our trade diplomats to shine! 💪
M
Meera P.
Interesting read! I wonder which specific agricultural products might benefit most from this situation. Maybe basmati rice and spices?

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Tags:
Ashok Gulati India Agriculture US Trade Donald Trump Agricultural Exports Economic Policy
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