India–US Trade Deal: Dairy Still a Sensitive Grey Area
The abrupt end to last summer’s tariff war between India and the United States has brought immediate relief to markets, with President Donald Trump and Prime Minister Narendra Modi announcing a rollback of punitive duties on Indian goods to an 18% tariff. The move eased pressure on Indian exporters and sparked a rally in Asian equities, but beyond the headline tariff cut, the contours of the deal remain strikingly opaque.
Key claims made by the US side — including India’s alleged commitment to spend $500 billion in the US economy and to halt purchases of Russian oil — found no confirmation in India’s official communication. Moscow, too, indicated it had received no such signal from New Delhi. This lack of clarity reinforces a familiar pattern in Trump-era trade diplomacy, where political announcements precede detailed agreements, leaving businesses uncertain about future obligations and risks.
For the dairy sector, the message is clearer by omission. While Trump suggested India would slash tariffs and non-tariff barriers on US goods to zero, experts and policymakers remain sceptical. Dairy continues to be a red line for India, given cultural sensitivities around cattle feed practices and the livelihoods of nearly 70 million people dependent on dairying. Any large-scale opening to US dairy imports is widely seen as politically and socially untenable.
Agriculture more broadly faces similar constraints. Limited accommodation may be explored in areas such as corn or ethanol, but no specifics have emerged. Until a formal, published trade text materialises, the India–US understanding remains more a social-media truce than a comprehensive trade agreement — with dairy firmly insulated from concessions, at least for now.
Source : Dairynews7x7 Feb 6th 2026 Read full article here in New York Times