The US-India joint statement on the framework also makes clear that while the US has secured incremental access in several areas, it ultimately stopped short of crossing India’s red lines in agriculture and dairy, the most contentious chapters of the negotiations.
The talks will continue toward a full Bilateral Trade Agreement. Yet the contours of what has been included, and more importantly, what has been left out, offer telling insight into the balance of leverage between the two sides.
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Agriculture at the heart of the stalemate
Agriculture, food and dairy products were the most difficult parts of the negotiations and the main reason talks dragged on for nearly a year. India remained firm in refusing to dilute its long-standing red lines, particularly on dairy and staple agricultural commodities, citing farmer livelihoods, price stability and food security and health and cultural concerns. The joint framework statement reflects this resistance.
While the statement does mention agriculture, the scope of concessions is narrowly defined. India has agreed to eliminate or reduce tariffs on a range of US food and agricultural products such as dried distillers’ grains (DDGs), red sorghum for animal feed, tree nuts, fresh and processed fruit, soybean oil and wine and spirits. Crucially, dairy products do not feature at all in the statement.
This omission is striking given the US industry’s long-standing push for access to India’s dairy market. Its absence underscores that the US ultimately accepted India’s red line on dairy, recognising both the political sensitivity and structural complexity of the sector.
Why India’s red lines remain intact
A closer look at the products listed in the framework shows that US market access gains largely fall within categories that do not threaten India’s core agricultural interests. Many of the items, such as DDGs and red sorghum, are used as animal feed or fodder rather than as direct food staples. Others, like tree nuts and fresh and processed fruits, are products India already imports in significant quantities.
The same logic applies to soybean oil. India imports most of its soybean oil from Argentina, Brazil and Russia, with only a marginal share coming from the US. Opening the door slightly wider to US soybean oil therefore may not fundamentally alter domestic market dynamics.
In this sense, the framework represents a measured compromise. India has offered tariff adjustments in areas where domestic resistance is limited, while the US has refrained from pushing into sectors that would have triggered political backlash and derailed the talks altogether.
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Existing trade flows put the deal in perspective
Current trade data can further contextualise the agricultural commitments in the framework. According to the USDA, total US agricultural and food exports to India were valued at $2.25 billion in 2024. Tree nuts, particularly almonds, dominate this trade. India imported $1.12 billion worth of tree nuts from the United States in 2024 alone. Other significant US exports include ethanol, cotton, pulses, essential oils, fresh fruit and soybean oil.
By contrast, India’s agricultural and food exports to the US in 2024 were nearly three times larger, at approximately $6.2 billion. These exports include marine products, spices, rice and dairy products. This asymmetry explains why India was especially cautious about opening its domestic market further; it already runs a substantial agricultural trade surplus with the US and has little incentive to risk destabilising sensitive sectors.
The DDGs question
One area where the framework could still have some domestic repercussions is dried distillers’ grains (DDGs). Reports suggest that a large influx of American DDGs, if it happens, could exert downward pressure on prices of domestically produced DDGs, whose volumes have surged in recent years due to India’s expansion of grain-based ethanol production.
This potential impact might extend beyond DDGs. Increased availability of imported DDGs could further depress soymeal prices, which have already fallen sharply over the past few years as DDGs increasingly replaced soymeal in animal feed. Soybean farmers have felt this strain. Soybean prices have remained below minimum support price levels for the past few years, partly because soybean extraction yields only about 18 per cent oil, with the remainder becoming meal that now faces weaker demand.
For these reasons, even limited concessions on feed products would be watched closely by domestic stakeholders, despite India’s agricultural red lines remaining intact.
Fruit imports and the apple factor
More clarity is also awaited on fruit imports, particularly apples, which constitute a major share of US fruit exports to India. While apples are included within the broader category of fresh and processed fruits mentioned in the framework, the precise tariff adjustments and import volumes remain unclear. Any significant increase might affect domestic growers making this another area where implementation details will matter as much as headline commitments.
A major sticking point is resolved
The interim framework shows that the US had to adjust its expectations on agriculture and dairy in order to secure a broader trade understanding. India, on its part, conceded selectively without crossing its most politically sensitive thresholds. The absence of dairy from the agreement, the focus on feed inputs and already-imported products, and the likely preservation of India’s agricultural trade surplus all point to the US stopping short of India’s red lines.
However, as talks move toward a full Bilateral Trade Agreement, agriculture and dairy sectors will be keenly watched. For now, however, India has managed to protect a large swathe of its agricultural market, even as it shows openness to cooperation on its own carefully defined terms.