Protecting India’s farms from cheap imports

AT a time when cereal crops — wheat and paddy — are still holding steady, almost all other major crops have lost lustre. The prices of pulses, oilseeds (including soybean), cotton and maize are in sharp decline. The alarm bells have never sounded so loudly.

Commerce Minister Piyush Goyal rightly put up a brave front at the Berlin Global Dialogue recently. He said that India doesn't sign deals with "guns to the head." These courageous words, coming at a difficult time internationally, take me back to the days when a visibly irate Agriculture Minister, Jagjivan Ram, had reportedly walked out in a huff from a meeting at the UN Food and Agriculture Organisation (FAO) headquarters in Rome.

If I can paraphrase correctly what Dr M S Swaminathan, the then Agriculture Secretary, had shared with me: "Hell with you and your intent of pushing agricultural exports to us," Ram had told a senior US official, adding: "India will never import food from America."

This was Swaminathan's reply when I asked him who he thought was the best Agriculture Minister since he had the privilege of working with almost all of them in various capacities since Independence. Jagjivan Ram was the Minister for Agriculture and Irrigation from 1974 to 1977.

Let us, therefore, remember that the US had always wanted to get a foothold into the vast Indian agricultural market. No wonder, securing market access for agricultural commodities into India was essentially a major US foreign policy desire. It didn't happen.

More recently, while Trump's authoritative and whimsical tossing of tariffs is driving countries to adjust to the New World Order, India has so far put up a valiant fight in the ongoing US-India trade negotiations to protect its agriculture, dairy and fisheries turf. But strong domestic lobbies, which have always stood with multinational interests, are once again getting restive, and that too in the name of atmanirbharta.

The domestic realities cannot be wished away in what is being projected as a win-win 'strategic' trade deal with the US when it comes to opening up for cotton, soybean, maize, dairy, and apples and other stone fruits.

The next target would obviously be rice, followed by wheat, where the real US interest lies. While the Niti Aayog has already withdrawn a working paper that sought the entry of the contentious genetically modified (GM) apples, maize and soybean, there are other mainline economists, who find it appropriate to open the market for milk and milk products in line with the zero-duty imports of cotton.

Not realising that in the US there are about 8,000 cotton growers and with an average farm size of 600 hectares, they still get an annual subsidy of over $1,00,000. This lowers the international prices as a result of which farmers in developing countries suffer.

On the other hand, in India there are 98 lakh cotton growers, with an average landholding size of 1 to 3 acres. Cheaper, subsidised imports throttle their already meagre livelihoods. If the domestic cotton industry had instead stood with our farmers that would have truly been a 'win-win' situation. By removing import tariffs to zero, India has willingly thrown its farmers to face the wolves.

When it comes to pulses, the supply-demand equation fails to work. In the past five years, the area under pulses has significantly declined from 30.7 million hectares to 27.6 million hectares.

Yet, given the high demand, the farm gate prices haven't shot up. In fact, the prevailing prices are about 30 per cent lower than the minimum support price (MSP) announced. That is because the shortfall in production has been met by cheaper imports; in reality, it is double the quantity that is required, duty-free for many legumes. In 2024-25 alone, 7.6 million tonnes of pulses were imported. News reports say that in the past five years, against the expenditure of Rs 12,153 crore on the import of pulses in 2020-21, the value of imports has already crossed Rs 47,000 crore in 2024-25.

Justifying the import of GM soy in the name of attaining self-sufficiency in edible oils is again a misdirected attempt. Although the soy belts of Madhya Pradesh and Maharashtra are crying for an assured price, with numerous tractor protests at the panchayat level being held, the prevailing market price for soybean hovers between Rs 3,500 and Rs 4,000 per quintal against the declared MSP of Rs 5,328.

While area and productivity are on the decline for want of an assured price (and also climate vulnerability), the news of possible GM soybean import is being met with stiff resistance.

A recent Rajasthan High Court order stopping the import and sale of GM foods till the Centre frames regulations will pose another hurdle.

This reminds me of the time when the US had earlier exerted pressure to open up for GM soybean imports. To a campaign led by New Delhi-based Forum for Biotechnology and Food Security, the Indian Council of Agricultural Research (ICAR) had finally called for splitting the soybeans on arrival at the Indian ports. This was resisted by the US suppliers (backed by senior USDA officials), but India refused to buckle bypassing the domestic GM regulatory mechanism.

The same approach needs to be followed now for GM soy imports, if at all imports become inevitable.

Similarly, in the case of maize, domestic prices have already nosedived amid media reports that import duties may be reduced from the existing 50 per cent to 15-16 per cent. Against the MSP of Rs 2,400 per quintal, market prices have dipped to as low as Rs 1,100 to Rs 1,200 per quintal at some places.

In the case of milk also, India should never experiment with 'strategic' trade advantages because in the US also, 93 per cent of the small dairy farms have pulled down their shutters in the past 15 years. In France, a strong consumer movement has sprung up to pay a relatively higher price for milk to save the economic viability of dairy farms.

India cannot be allowed to slip back to the days when food would come from the ships to feed the nation. Nothing is more important than ensuring freedom from hunger, no matter what it costs.

Devinder Sharma is Food & Agriculture Specialist.