In the second breakthrough in three months, India said on the sidelines of the G20 summit meeting that it would reduce import duties on frozen U.S. turkey and duck meat. Lower tariffs will give U.S. exports a chance to win sales in the rapidly growing market, said U.S. poultry groups, while calling for India to open its market further.
U.S. trade representative Katherine Tai said the announcement resolved the last outstanding dispute between the nations, “an important milestone” in trade relations. Agriculture Secretary Tom Vilsack said “important progress” had been recorded but “significant tariff and nontariff barriers to American agricultural products accessing the Indian market remain.”
India has agreed to reduce tariffs on U.S. products including frozen turkey, frozen duck, and fresh, frozen, dried, and processed blueberries and cranberries, said Tai’s office on Friday. In late June, as part of a visit by Prime Minister Narendra Modi to Washington, the nations announced the removal of retaliatory tariffs on U.S. apples, chickpeas, lentils, almonds, and walnuts; that development took effect last week.
At present, India is a small market for U.S. food and ag exports. Sales were forecast at $1.6 billion in the fiscal year that opens on Oct. 1, or slightly less than 1 percent of farm exports. The United States was forecast to import twice as much of Indian food and ag products — $3.2 billion.
Under the latest agreement, India will remove retaliatory tariffs and reduce the basic tariff to 5 percent on frozen whole turkeys and frozen turkey parts from the current 30 percent, said the National Turkey Federation. “This new agreement will now allow U.S. turkey growers to compete in the rapidly expanding market,” it said.
“We very much appreciate our government’s ongoing efforts to increase access for U.S. poultry and egg products in India,” said Greg Tyler, chief executive of USA Poultry and Egg Export Council. “We hope that in the future we are able to gain better access for chicken and to expand access for duck as well, which can help to further address the protein needs of Indian consumers.”
Indian TV news channel ABP Live said, “While all trade disputes between both nations now stand resolved, India did not stand to gain much.” The 2019 Trump-era cancellation of $6 billion worth of trade benefits to Indian exporters through the U.S. Generalize System of Preferences was not restored, it said. Poultry trade has been an issue between the nations since 2007, with India saying it needed to protect its producers from low-priced U.S.-grown chicken legs. The United States took the issue to the WTO and won.
The United States was among six nations to accuse India in April of violating world trade rules by giving exorbitant subsidies to its wheat and rice growers. The lavish aid was equal to 81 percent of value of the wheat crop and 94 percent of the value of the rice crop in 2020/21, although India had agreed to limits its market price supports to 10 percent, said the counter-notification filed by Australia, Canada, Paraguay, Thailand, Ukraine, and the United States.