US President Trump’s threat of new rice tariffs is unlikely to significantly impact India, as exports to the US are a small fraction of global sales and already face high duties. Experts suggest this is a negotiation tactic amid ongoing trade deal talks, with India aiming to lift existing US tariffs.
NEW DELHI: US President Donald Trump’s latest threat to impose fresh tariffs on rice is unlikely to have a severe impact on Indian exports.”India exported $392 million worth of rice to the US in FY2025, just 3% of its global rice exports, and already faces tariffs of about 53% in the US market; 86% of these shipments are premium basmati. New duties would scarcely dent Indian exporters, who have strong markets elsewhere, but would make rice costlier for American households,” said trade research body GTRI.A bulk of the 6 million tonne exported to the US may be headed to kitchens of Indian-origin Americans or those on visas. The only substitute for basmati rice can be from Pakistan but the quantities are much lower. Overall, a bulk of India’s rice exports consists of non-basmati rice.Trump’s latest threat comes amid a team from the US visiting India with talks on the much-delayed trade deal scheduled for Wednesday and Thursday. While the agenda for the latest discussions were not immediately known, the visit was a surprise as govt officials had earlier said most issues had been sorted out and last-mile talks were expected. News about the US delegation’s trip came ahead of Russian President Vladimir Putin’s visit to India. While Trump has taken unilateral measures on trade since returning to office, India’s rice exports are not seen as “dumping” as claimed by the US president, who is not seen as someone who always sticks to facts. Given volumes, neither are rice exports causing harm to domestic market, nor are they subsidised. As a result, it is seen as a pressure tactic amid talks for a bilateral deal.India and the US had launched negotiations for a trade deal in Feb and hoped to close talks by Sept-Oct. But with govt refusing to agree to Trump’s demand for reducing levies on food and GM crops, the US hit back with 25% reciprocal tariffs and another 25% secondary tariffs, citing India’s purchase of Russian oil and defence equipment. In the first phase, which govt is hoping can be clinched by the month-end, India expects the secondary tariffs to be lifted while also seeking concessions on reciprocal tariffs.Trump, in the same event, also threatened high tariff on agriculture imports from Canada and other countries.
