The recent announcement by US President Donald Trump to implement a 26 per cent reciprocal tariff on Indian goods has understandably sparked concern across various sectors, including agriculture. (It has now been paused for 90 days, though). For India, the implications of such a move aren’t black and white—they fall into a grey zone of mixed outcomes. Some segments feel the heat, while others find unexpected openings.
The impact of these tariffs on Indian agriculture can be viewed from two angles: cost pressures and market opportunities. These tariffs have indirectly raised the cost of imported machinery and agrochemical inputs, adding pressure to production costs for Indian farmers and agri-businesses. Sectors such as seafood and gherkins have expressed concern about reduced competitiveness in the US market.
However, commodities like rice and cashews have gained due to India’s relatively lower tariff rates compared to those of its regional competitors. For instance, a 26 per cent tariff is imposed on Indian goods, whereas much higher tariffs are levied on other Asian countries, including China and Vietnam. This relative position maintains the competitiveness of Indian agricultural exports and even opens up avenues in the US despite tariff wars.