India and the US are likely to finalize a long-awaited trade pact but are held up by one thing only—access to India’s dairy industry. Senior Indian government officials have assured that the agreement may be finalized in the next one or two days.
But the US is insisting on access to India’s dairy industry, which the government is standing firm against. This industry is the hub of India’s rural economy, and New Delhi has stated categorically that it would not give in on this aspect.
India Stands Firm on Dairy
Washington is seeking India to relax access to the market for American dairy products. New Delhi has drawn a tough line in response. Indian officials argue that millions of small farmers rely on the domestic dairy industry, and the government will not jeopardize it.
India’s rural livelihoods, food habits, and economic stability depend upon this industry. US negotiators so far seem to realize India’s point and are weighing a middle ground.
US Could Grant Relief, India Proposes Concessions
Reports indicate that the US is likely to grant some relief on dairy-related demands. In turn, India is considering concessions on some American electronic goods. These adjustments by both parties may assist them in securing the July 9 deadline for the agreement.
Leaders Demonstrate Optimism
External Affairs Minister S. Jaishankar recently expressed hope that the negotiations would result in a “successful conclusion.” His counterpart Trump, who is the President of the US, shared the same optimism. Trump asserted that India appears to be willing to reduce trade barriers, particularly for US businesses.
“If they do, we’re going to have a deal for less—much less—tariffs,” Trump said. He was referring to the 26% reciprocal tariffs he announced on April 2. These tariffs are currently suspended while negotiations continue.
The clock is ticking. Both nations are racing to settle the last details. India’s tough stand on dairy and the US tariff relief offer indicate a potential compromise. If all goes well, the two nations will shortly be signing an agreement that increases trade and safeguards fundamental interests.
