No FTA? US pressures India to lower duties on both GM & natural crops

Efforts to forge a free trade agreement (FTA) between the United States and India have hit a snag, primarily due to American demands for reduced tariffs on agricultural goods, including genetically modified (GM) foods. Indian negotiators are wary of the potential threat to the livelihoods of millions of farmers, stalling progress on a deal both countries are eager to finalise. The US push for lower duties on GM crops like maize and soybeans has intensified the dispute, given India’s stringent import controls on GM products.

The US, aiming to expand its agricultural exports, has pressed for better access to India’s massive market. However, India, where agriculture supports nearly half of the workforce, is fiercely protective of its farming sector. “India cannot compromise the interests of its farmers,” a senior Indian trade ministry official declared, underscoring the issue’s sensitivity.

India’s stance on GM foods

India’s reluctance to embrace GM foods is mostly due to the resistance that comes from the Sangh Parivar, as the RSS-affiliated Swadeshi Jagran Manch vehemently opposes even the slightest hint of anything foreign coming to the country. But it also reflects Prime Minister Narendra Modi's concerns about environmental safety, public health and the economic impact on small-scale farmers.

Only GM cotton is currently approved for cultivation, while edible GM crops face strict regulatory hurdles. The Genetic Engineering Appraisal Committee (GEAC) oversees approvals, but progress is slow amid public scepticism and legal challenges. For example, GM mustard, conditionally cleared in 2022, remains embroiled in controversy, per a 2024 Economic Times report.

India imported $4 billion in edible oils in 2024, including GM-derived products, but these are subject to heavy processing and mandatory labelling, as per a Business Standard analysis.

The US, a global leader in GM agriculture, argues that easing India’s restrictions would align with international trade norms, pointing to its $50 billion GM crop export market in 2024 (Reuters, 2025). Yet, Indian farmers’ groups fear that cheaper US imports could devastate local markets, worsening rural distress.

Wider trade challenges

The agricultural standoff risks derailing the entire FTA, which both nations see as vital. The US seeks greater market access for its tech and energy sectors while India aims to boost exports of pharmaceuticals, IT services and textiles.

Bilateral trade hit $120 billion in 2024, with scope to grow significantly under an FTA, according to a Financial Express report in 2025.

However, non-tariff barriers, such as India’s complex certification processes and US food safety standards, remain sticking points.

What may work out

To break the impasse, analysts propose a gradual approach. The US could support India in developing its GM regulatory framework, fostering confidence. India, in turn, might offer tariff reductions on processed GM products rather than raw crops, balancing trade and domestic priorities. A Hindustan Times editorial (February 2025) suggested that cooperation on sustainable agriculture could bridge gaps.

Both parties remain hopeful, with a US trade official stating, “We are committed to a fair and balanced agreement.” With India facing domestic economic pressures and the US navigating global trade tensions, resolving these differences swiftly is crucial. The talks’ outcome will not only shape bilateral relations but also influence India’s GM policy on the world stage.