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US likely to push for tariff cuts, regulatory overhauls under proposed BTA with India: GTRI

05 May 2025 Evaluate

Think tank Global Trade Research Initiative (GTRI) has said that the US is expected to push for sweeping changes in India's policies, ranging from tariff reductions to regulatory overhauls, that could benefit American firms and exporters, under the proposed bilateral trade agreement (BTA) with India. It added that with regard to Agri sector, the US demands include scaling back India's minimum price support (MSP) programs for crops like rice and wheat, removing restrictions on genetically modified (GM) imports, and lowering farm tariffs. Similarly, on dairy products, the US argues that India's GM-free feed certification and facility registration protocols effectively bar American dairy imports. GTRI has indicated that India considers this policy non-negotiable as the Indian rules prohibit imports from animals fed with animal-derived feed, for example, butter from a cow fed meat due to religious sensitivities.

Apart from Agri and dairy products, GTRI has said that, the US may also seek easing of restrictions on US retail giants like Amazon and Walmart that face roadblocks due to India's restrictions on foreign-owned inventory-based e-commerce trading. Meanwhile, in order to protect the small domestic retailers from unfair competition from deep-pocketed foreign firms, India has resisted easing of such restrictions. It added that the country also views these restrictions as part of preserving regulatory autonomy in a fast-evolving sector.  

With regards to capital goods, GTRI has indicated that the US has criticized India's cumbersome licensing requirements for remanufactured and second-hand capital goods, calling the process costly and slow, as the India mandates technical certificates, enforces quantity restrictions, and demands a residual life guarantee of at least five years for imports. GTRI has emphasized the importance of India maintaining differentiating between new and remanufactured products to prevent dumping of obsolete technologies and to protect local manufacturing. It has warned that as the negotiations proceed, Washington will continue pressing for wide-ranging reforms in tariffs, standards, digital rules, and services access.

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