The Global Trade Research Initiative (GTRI) is cautioning against the potential implications of allowing imports of genetically modified (GM) farm products from the United States, particularly concerning the impact on India's agricultural exports. As India and the U.S. engage in negotiations for an interim trade pact, the GTRI has voiced concerns regarding the reduction of import duties on U.S. farm goods and the potential risks to India's food security and the livelihoods of its farmers.
One of the primary concerns raised by the GTRI is the threat posed by heavily subsidized U.S. agricultural products, including rice, dairy, poultry, and GM soy. These subsidies provide U.S. producers with an unfair competitive advantage, potentially leading to an inundation of Indian markets with cheap imports, especially during periods of global price collapses. The GTRI warns that such a scenario could devastate the livelihoods of over 700 million rural residents who depend on agriculture.
The GTRI specifically highlights the risk associated with allowing the import of GM products like soybean meal and distillers dried grains with solubles (DDGS) for animal feed. While India may consider allowing imports of some animal feed made from genetically modified US farm products as part of its push to strike a trade deal with Washington. The EU has strict GM labeling rules and strong consumer resistance to GM-linked products. Even though GM feed is permitted, many European buyers prefer fully GM-free supply chains.
Ajay Srivastava, the founder of GTRI, has pointed out that India's fragmented agri-logistics and lack of segregation infrastructure make cross-contamination likely, risking trace GM presence in export consignments. This could lead to shipment rejections, higher testing costs, and erosion of India's GMO-free image, especially in key markets like the European Union. The EU market is particularly sensitive, with strict regulations and consumer preferences for non-GM products. Allowing GM imports could jeopardize India's exports of products like rice, tea, and organic foods to the EU.
India has traditionally maintained a surplus in agricultural trade with the U.S. To expand its market access and increase exports, India may need to strategically open up to U.S. imports. A NITI Aayog working paper suggests that India could import GM maize for ethanol blending, while the residual could be exported as animal feed. It also suggests that India could consider lowering tariffs on agricultural commodities where domestic production is minimal or where imports do not directly compete with local products due to differences in quality grades and seasons.
The U.S. has criticized India's regulations on genetically modified (GM) food, describing them as ambiguous and lacking scientific basis, which impedes American biotechnology exports. However, India remains cautious due to strong public opposition to GM foods and concerns about environmental risks. Concerns extend beyond potential environmental risks and soil health to the significant impact on India's agricultural exports to markets sensitive to GM ingredients.
The GTRI's concerns highlight the need for India to carefully consider the potential consequences of lowering import duties on U.S. farm goods, particularly GM products. While the trade agreement with the U.S. presents an opportunity to enhance bilateral trade, India must ensure that its food security, the livelihoods of its farmers, and its export interests are adequately protected. Maintaining strategic tariffs and stricter regulations is essential for protecting India’s numerous small farmers, managing international price differences and ensuring the nation’s long-term food security.
