Indo-US trade ties need to be more ambitious: Ambassador Garcetti

Settling for another deal 'won't be good enough', he says at economic summit

The United States wants to increase agriculture exports to India and help in the dairy sector, said Ambassador Eric Garcetti on Tuesday as he called for a "more ambitious" bilateral trade partnership.

India’s productivity in dairy has levelled off and American companies can help, he said at the 20th Indo-US Economic Summit organised by the Indo-American Chamber of Commerce. US exports would involve the sale of feed grains to India.

A trade deal between the two countries has stalled after talks on USA’s demand that India procure its dairy products.

“The goal that we should be setting for each other is how we can be more ambitious. Not just settle for another deal. Not just settle, as we have done in the last few months, for bringing down the retaliatory tariffs and trade disputes between our countries. That’s not good enough,” said Garcetti.

India is reluctant to open its market to foreign agriculture products as a large share of its workforce is dependent on farming. Garcetti's comments assume significance as India and the US have solved some disputes over tariffs and market access.

Last year, India agreed to allow the import of pork and pork products from the US as a part of a bilateral trade deal which will facilitate exports of Indian mangoes and pomegranates. Earlier this year, India lifted retaliatory tariffs on US apples, chickpeas, lentils, almonds and walnuts.

India agreed last week to bring down the import duty to 5-10 per cent on some fresh and processed food items as part of a larger dispute settlement between New Delhi and Washington at the World Trade Organization (WTO). Duties will be reduced on import of frozen turkey and duck, as well as blueberries, and cranberries.

Garcetti said the need is to do away with "even the smallest of friction between the two countries in terms of trade", reduce tariffs further and create a predictable regulatory environment.

India, as of 2022, was the thirteenth largest destination for $200 billion worth of US agriculture exports, according to the US Department of Agriculture (USDA). Of the $2.2 billion worth of US agriculture exports to India, almonds made up for almost half ($1 billion), followed by cotton ($494 million), and ethanol ($211 million), the USDA said in a report last year.

India was the largest export destination for US soybean oil, the second-largest for tree nuts, and the fourth-largest for ethanol. The US is India’s fifth-largest supplier of agricultural goods, representing 6 percent of the total import market, behind Indonesia, Malaysia, Argentina, and Brazil.

The US is willing to explore ways to get Indian food pre-approved for its market and vice versa by aligning standards, Garcetti said. Robert M Califf, the United States Food and Drug Administration (USFDA) commissioner, led a delegation to India last week for discussions.

India has the highest number of USFDA approved pharmaceutical plants outside the US, more than 665.