• Pawan Khera

Congress Demands Answers on US Trade Deal Impacting Indian Farmers and MSMEs

140 crore Indians are getting to know our own government’s Trade Policy through the US President – Trump. Has the GOI taken a decision to cut Tariffs under pressure by PM Modi’s close friend – Mr. Donald Trump? Has Union Minister Piyush Goyal, who is in the United States to apparently negotiate a Trade Deal, buckled under pressure and signed on the dotted line dictated by ‘Howdy Modi’s close compatriot Namaste Trump’? What does the fresh statement by the US President mean for India where he said that “India has agreed to cut their tariffs … way down now because somebody’s finally exposing them for what they have done?” Why is this ‘deal’, if any, shrouded under a veil of secrecy? If countries like Mexico and Canada can negotiate a month pause on US reciprocal tariffs, why couldn’t India? India demands answers. . India-US have had a stable, strong and a valued strategic comprehensive relationship, built over decades of mutual cooperation. Dr Manmohan Singh and George W Bush have together navigated the details of the historic Indo-US deal, which was mutually beneficial. Dr Singh had virtually risked his own government’s political future for the same, but that was in NATIONAL INTERESTS and end India’s Civil Nuclear apartheid. Today, PM Modi is doing just the opposite, his government seems to know-toe the line set by Mr. Trump. Just yesterday, at a Media Conclave in India, US Commerce Secretary Howard Lutnick said that Indian Farm sector cannot remain closed. Today, we have come one step forward, where a Union Minister is on the US soil and we are being told by none the less than the US President, that India has agreed to cutting its tariffs and India being ‘exposed’!

We are not surprised if indeed Modi Govt. has agreed to reduce our tariffs, for they have been incrementally signaling that they will eventually do it, even before PM Modi’s visit to the US in February 2025. 1. Union Budget 2025-26 lowered import duties on high-capacity motorcycles for American brands like Harley-Davidson. 2. On February 13th, Modi Govt. slashed tariffs on American bourbon whiskey to 100% from 150%. 3. GOI has also reduced import duties on Washington apples, from 50% to 15%. 4. There are also negotiations going on reducing tariffs on horticulture products like walnuts, cranberries and dairy. 5. A recent study has found that “After accounting for PLI incentives and other concessions, the real earnings from India’s exports of iPhones to the US are close to zero.”

The consequences of high US tariffs, including reciprocal tariffs could be disastrous for India: - 1. India’s MSMEs which contribute over 45% of India’s exports will suffer, with Modi Ji’s cronies flourishing, instead. 2. India’s GDP may take a massive hit upto 10 basis points. 3. Trade Deficit may rise monumentally, and Rupee will further weaken. 4. Indian agriculture will face challenges at three levels – country-level, product-level competitiveness loss, and increased non-tariff barriers. A paper by Indian Council for Research on International Economic Relations a) A blanket tariff hike would reduce the competitiveness of products like rice and frozen shrimp against competitors like Vietnam, Thailand, and Indonesia. b) If the US raises product tariffs in response, it could severely impact India’s processed food exports (ready to eat meals, snacks), shrimps, cereal and dairy products which have been growing as part of India’s shift toward value-added agricultural exports. 5. Higher US tariffs could push cheap Chinese goods into India, harming local manufacturers. Textiles, pharmaceuticals, and auto components, medical devices face costlier realignments and supply chain disruptions.

Our Simple Questions to PM Modi on US President’s Trump’s statement: - 1. Why have you surrendered India’s National & Strategic Interests? What was your Minister Piyush Goyal doing in US, when President Trump announced that India has agreed to reduce tariffs? Isn’t suffering reciprocal tariffs better than reducing own tariffs, after reciprocal tariffs have been announced? 2. Who have you taken into confidence before taking this strategic decision? Union Cabinet? CCEA? Parliament? Political Parties? If Mexico and Canada can pick up the phone and speak to Mr. Trump, then why not YOU? 3. Has the Modi Govt. surrendered the interests of our MSMEs to benefit select crony friends? Are the interests of crony friends more important for you than the interests of Indian farmers & Manufacturing sector? Modi Govt.’s Trade Policy is DISASTROUS and if the present concession holds true, Indian Economy – our already failed Make in India, our Aatmanirbhar Bharat plan – would be further crushed by the weight of Modi Ji’s SURRENDER!

Based on Press Briefing on March 8, 2025 by Shri Pawan Khera, Chairman, Media & Publicity (Communications Dept), AICC