Piyush Goyal (PTI photo)
New Delhi: Commerce and Industry Minister Piyush Goyal on Sunday said the government has aggressively tried to advance the interests of the agriculture sector in the US trade deal while protecting its sensitivities around dairy and agriculture. “We have $30 billion of imports. Importantly, we have $55 billion of exports of agriculture and fish products. So, we should have aggressive interests, which is what we have focused on, along with protecting the sensitive areas,” he told TOI in an interview.
The deal opens doors for many products like tea, coffee, spices and fruits, where the US allows their import at zero reciprocal tariff, while also helping seafood exporters compete favorably as the reciprocal tariff has been reduced to 18%. The minister also said concerns over the import of distillers dry grains with solubles, a feed ingredient that is a by-product of dry-milled ethanol production, are misplaced and India has only opened a small window. Although Goyal declined to divulge details, officials said that against the domestic animal feed consumption of 500 lakh tonnes, the quota given to the US is only five lakh tonnes. The minister said the demand has come from the industry itself amid increasing livestock population and increasing requirement of fodder, especially at a time when cultivable land is decreasing.
‘Farmers understand that their interests and sensitivities have been protected’
Commerce and Industry Minister Piyush Goyal His calendar is always full of meetings, and the past few weeks have been particularly busy due to trade agreements with the EU and the US. Minister discusses details of US deal TOI’s Siddhartha Emphasizing that the agreement will help Indian exporters to grow and boost two-way trade. Part:Is there a feeling of relief or a sense of accomplishment?This was a long-running negotiation, although not a very long one by FTA standards. It is very satisfying that the world’s largest democracies are coming closer together, further strengthening the world’s most powerful relationships. America is already a $30 trillion economy and growing continuously, India may be $4 trillion today, the Prime Minister has given a clear roadmap for a developed India by 2047, we will become a $30-35 trillion economy, which means the delta of opportunity is huge. To be able to take advantage of that opportunity we need to create better markets, open new vistas, attract investments, attract technologies to India. It is quite satisfactory to conclude trade deals of EU and US in a period of eight days, which in a way shows the emergence of India as a self-confident nation.You, your team and other people in the government have been working on this for almost a year. There were ups and downs. What was the turning point?Trade negotiations are about taking a crystal gaze toward the future. Both parties are looking for the best deal, the important thing is to get the balance right, which is beneficial to both parties. As it gets closer to perfection, it always becomes more difficult to strike the right balance. You are trying to protect your sensitivity, the other party is trying to protect theirs. You are looking at your ability to benefit from the agreement as much as the other party. This process was a labor of love over the last 10 months. It ended very happily when Prime Minister Narendra Modi and President Trump in their call last Monday decided to close the negotiations with a rate for India which is the best for any of our competitors.The Modi government is considered very forthright and forthright. Peter Navarro, Commerce Secretary Howard Lutnick, Treasury Secretary Scott Besant made very aggressive comments in the negotiations. There was no response from India. Was this deliberate silence?I don’t think we were stuck on any position. I don’t think there was any bitterness on either side during the entire conversation. Everyone has a certain style and it is important to appreciate that style. So, I don’t think India has ever had any misunderstanding on the trade front. We maintained a very good atmosphere during the talks.So, both sides were making progress even when there were such headlines that things reached the point of no return?If you don’t misunderstand me, don’t believe the headlines. This is not for newspapers alone, this is for all of us. Often we oversell our thinking or overbuy our understanding or philosophy. Any person should always have the ability to listen to other’s new point of view and maintain patience, especially in business negotiations as it is a long-term affair. You can’t rush things. That’s why I’ve often said never set a deadline for business negotiations, you’ll make mistakes.You said earlier that every trade deal stands on its own feet. But right on time, within eight days, the EU and US deal was finalized. As far as Americans were concerned, was the EU agreement an important issue?It’s just that both happened in a very short period of time. We are currently engaged in about 12-13 negotiations around the world and are concluding them quite rapidly. We have concluded UK, New Zealand, Oman, EU and US. There’s another one on the anvil. This reflects India’s growing self-confidence, growing understanding of international trade and the power of international trade. Our desire to become a developed nation by 2047 cannot be achieved unless we really focus on very large markets around the world.Farmer organizations have called for nationwide protests on February 12. Do you see this as a risk to the agreement?I don’t think so because the farmer bodies also understand that we have completely preserved the sensitivities in agriculture and excluded the high production sectors in India where we are generally self-sufficient: meat, poultry, rice, wheat, sugar, all dairy items, all GM products, soybean and maize. There is hardly any thing which makes a farmer feel threatened. We have seen the import figures. We have been importing soybean oil and tree nuts since the time of Congress. We have heard complaints that we have closed our doors to wine and spirits without reason.Import of many fresh and processed fruits continues. These are not available in sufficient quantity in India. India imports 5.5 lakh tonnes of apples and there are some commodities which India requires. Our imports are about 30 billion dollars. Importantly, we have exports of agricultural and fish products worth $55 billion. Therefore, we should have an offensive interest which we have focused on as well as security of sensitive areas. The US market has been opened up to a large number of products for our farmers at zero reciprocal duty, be it tea, coffee or spices, bananas, coconuts, mangoes, kiwis and papayas. Business is about competition, comparative advantage. Now, we have the best comparative advantage. It is up to our businesses, our exporters to get the best and make the best of this amazing deal.You have agreed to review non-tariff barriers on US agricultural products. Second, DDGS is going to be imported. Will this be at the expense of soybean farmers because it is cheaper?Concerns about non-tariff barriers are completely misplaced as neither India nor the US has non-tariff barriers. If there are any inaccuracies or any difficulties in doing business on both sides, we agree that we should try to smooth the edges and accelerate the benefits of this wonderful agreement. I see no reason why we shouldn’t address non-tariff barriers. We have done this in every agreement. America has some of the best standards. India is now emerging as a producer and service provider of high quality goods. Therefore, we have nothing to fear. As far as DDGS is concerned, we have a huge requirement and it is growing. What we have agreed upon is a very small quota. Animal husbandry departments and industries desperately want more DDGS because it is a very high quality protein. We have 194 million cattle, 112 million buffaloes and a total of 878 million livestock. As a government, I have to balance all the interests. But I can assure you that we have protected soybean. We are already importing soybean oil worth $5 billion every year. If something was opened up by UPA, for example to Indonesia or Japan or South Korea or Vietnam, I would like to compete more because that gives me better prices and better quality.India’s purchase of Russian oil was one of the things that stalled the deal. The US executive order calls for India to stop purchasing Russian oil, but the government is silent on this. Can you throw some light on that?The Commerce Ministry does not consider this subject. I don’t know the details, another ministry looks after this.You have thrown the ball into the court of the Ministry of External Affairs on Russian oil. How will you protect energy security? You talked about this in your statement in Parliament.I did, but based on the inputs given to me by the Ministry of External Affairs.The joint statement also mentions the removal of import licensing for ICT products. What exactly is it and, two, are we looking at a more resilient supply chain through this?India requires a huge amount of ICT products for its development and to connect with modern technology. In the budget we announced big concessions for data centres. But if we don’t get Nvidia chips or we don’t get AI tools or quantum computing tools or if we only depend on other geographies, we are hurting our country. It was an aggressive interest.Is this review also meant to rebalance trade, with some of it coming from countries that don’t look very friendly?India will try to get the best from all over the world and at the best prices. We want reliable partners in all this. Our focus is to encourage trade with trusted partners.This is the first tranche of the trade deal. What is the way forward? Will services be part of future negotiations?We will first convert it into a fair agreement and legally binding agreement and then we will continue to look at other areas for expanding trade and mutual cooperation.There is an explicit reference to amendments in the commitments in case of changes in the agreed tariffs by any country. Does this have anything to do with Trump’s unpredictable nature?No, this is a general clause to ensure that the fair agreement we reached remains fair.Do you think this deal will remove the cloud of uncertainty over investments that might have been put on hold?I certainly see this as a big incentive for investment, because investors like predictability and stability and they like to see a strong relationship on the business front. They can now plan investments with the confidence that import duties on their inputs are crystal clear.Along with the joint statement, USTR released a map showing PoK and Aksai Chin as part of India. Is this just a coincidence?Again, this is not my topic.
