{"id":51594,"date":"2025-06-24T11:32:51","date_gmt":"2025-06-24T06:02:51","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=51594"},"modified":"2025-06-25T11:18:46","modified_gmt":"2025-06-25T05:48:46","slug":"india-us-trade-deal-agriculture-concerns","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/india-us-trade-deal-agriculture-concerns\/","title":{"rendered":"India-US Trade Deal Faces Resistance from Sugar and Soybean Sectors"},"content":{"rendered":"<h2><b>India-US Trade Deal Agriculture Concerns Latest News<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">As India and the US push to finalise a bilateral trade deal before the July 9 deadline, two major Indian agri-industries are expressing concern.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The sugar industry opposes the import of ethanol and genetically modified (GM) maize for fuel blending, while the soybean processing industry is against GM soyabean imports.\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">It should be noted that the <\/span><span style=\"font-weight: 400;\">US is the world\u2019s top producer as well as exporter of both maize and fuel ethanol<\/span><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Also, it is the <\/span><span style=\"font-weight: 400;\">second biggest producer and exporter of soybean after Brazil<\/span><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">With the US seeking new markets amid geopolitical shifts, pressure is mounting on India to ease import restrictions.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, these domestic sectors fear such concessions could hurt local producers.<\/span><\/li>\n<\/ul>\n<h2><b>Ethanol Blending A Policy Success<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India\u2019s ethanol blending programme has grown significantly under the Modi government.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Average ethanol blending in petrol rose from 1.5% (2013-14) to 14.6% (2023-24).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In the current supply year (Nov 2024\u2013May 2025), the <\/span><span style=\"font-weight: 400;\">blending ratio reached 18.8%, nearing the 20% target by 2025-26<\/span><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n<h3><b>Shift from Sugarcane to Grains<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Since 2018-19, sugar mills have started using grains (especially maize and surplus rice) alongside molasses for ethanol.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In 2024-25, 68<\/span><span style=\"font-weight: 400;\">% of the 1,047.9 crore litres of ethanol is grain-based.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Maize alone contributes 483.9 crore litres<\/b><span style=\"font-weight: 400;\">, overtaking sugarcane-based sources.<\/span><\/li>\n<\/ul>\n<h2><b>Millers&#8217; Concerns Over Ethanol Imports<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Sugar millers are worried that sugarcane is losing importance as more ethanol is now being made from grains like maize.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">They fear that if India starts importing ethanol or genetically modified (GM) maize, sugarcane will be pushed aside even more.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Since sugar consumption in India is not growing, millers see their future in energy\u2014like ethanol-blended diesel or aviation fuel\u2014rather than in producing sugar<\/span><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n<h3><b>Food vs Fuel Debate<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Millers argue ethanol from sugarcane avoids food\/feed conflicts.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Unlike maize, sugar isn\u2019t a key livestock or poultry feed.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Diverting maize to fuel may strain supply for animal feed, affecting dairy, poultry, and egg sectors.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><b>India A Key Market for US Ethanol<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The US exported 724.5 crore litres of ethanol in 2024, with <\/span><b>India as the third largest<\/b> <b>buyer<\/b><span style=\"font-weight: 400;\"> (70.8 crore litres worth $441.3 million).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India restricts ethanol imports to non-fuel industrial use and under licence.<\/span><\/li>\n<\/ul>\n<h3><b>NITI Aayog Push for GM Maize Imports<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A working paper suggests importing cheaper US GM maize for ethanol.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Its byproduct (DDGS &#8211; distiller\u2019s dried grains with solubles) can be exported to avoid domestic feed concerns.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Authors claim this will help India meet biofuel targets without disturbing local food chains.<\/span><\/li>\n<\/ul>\n<h2><b>Concerns of India\u2019s Soyabean Industry<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">A NITI Aayog paper suggests importing soyabean, extracting oil for domestic use, and exporting the leftover GM-based de-oiled cake (meal).<\/span><\/p>\n<h3><b>SOPA&#8217;s Opposition to the Plan<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The Soybean Processors Association of India (SOPA) rejects the proposal due to logistical and economic challenges:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Most solvent extraction units are located inland (MP, Maharashtra), far from ports.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Transporting imported beans from ports to plants and then exporting the meal is not cost-effective.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Such a policy threatens the livelihood of nearly 7 million soyabean farmers.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><b>Limited Domestic Demand vs. China<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India processes 11\u201312 million tonnes of soyabean yearly, with most meal used domestically for food and feed.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Only ~2 million tonnes is exported, unlike China which crushes over 100 million tonnes annually for its massive livestock industry.<\/span><\/li>\n<\/ul>\n<h3><b>Fears of Foreign Dominance<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">If GM meal cannot be sold domestically, processing must shift closer to ports for export.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This could invite dominance by global agri-trading giants (e.g., ADM, Cargill, Bunge, Louis Dreyfus), pushing out domestic processors.<\/span><\/li>\n<\/ul>\n<h3><b>Import Duty Cuts Add Pressure<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Recently, the Centre reduced the import duty on crude soyabean, palm, and sunflower oil from 27.5% to 16.5%.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">SOPA fears this will undercut local processors by making imported oils cheaper, forcing many to shut or operate below capacity.<\/span><\/li>\n<\/ul>\n<h3><b>Falling Soyabean Prices Hurt Farmers<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Soyabean is currently trading at \u20b94,300\u2013\u20b94,350\/quintal in MP and Maharashtra\u2014well below the MSP of \u20b95,328.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Cheap imports of oil or seed could further depress prices and cause farmers to shift to other crops.<\/span><\/li>\n<\/ul>\n<p><b>Source<\/b> <a href=\"https:\/\/indianexpress.com\/article\/explained\/explained-economics\/why-these-two-agri-industries-wary-india-us-trade-deal-10082212\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400;\">IE<\/span><\/a><span style=\"font-weight: 400;\"> |\u00a0<\/span><a href=\"https:\/\/www.cnbctv18.com\/economy\/us-insists-india-resists-lower-duties-on-agricultural-dairy-and-gm-produce-govt-sources-19625618.htm\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400;\">CNBCTV18<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>India\u2019s sugar and soybean industries raise alarm over ethanol and GM crop imports in upcoming US trade deal talks.<\/p>\n","protected":false},"author":18,"featured_media":51627,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[1020,60,22,59],"class_list":{"0":"post-51594","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"tag-india-us-trade-deal-agriculture-concerns","9":"tag-mains-articles","10":"tag-upsc-current-affairs","11":"tag-upsc-mains-current-affairs","12":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/51594","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/18"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=51594"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/51594\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/51627"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=51594"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=51594"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=51594"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}