India’s Agricultural Trade: Policies and Prospects

Executive Summary

Since independence, India’s agricultural trade policies have been focused on protection. High tariffs, government price guarantees, and export bans have been frequently introduced to cushion farmers from price variations. But this shield has come at a cost. Export bans—such as those on wheat and non-basmati rice—send confusing signals to global markets, reducing trust in India as a dependable supplier.

Consumers, too, bear the brunt. Import tariffs, among the highest in the G20, make everyday items—from edible oils to dairy—more expensive than the global market. The result is a paradox: farmers are not always getting better prices, consumers are paying more, and India loses bargaining power in trade deals. While India has signed over a dozen trade agreements, it systematically shields agriculture through exclusion lists and modest Tariff Rate Quotas (TRQs).

There is a middle path. Liberalising carefully chosen sectors—like edible oils and nuts—could lower costs for consumers without threatening farmers. At the same time, India can leverage its strengths in rice, shrimp, and spices to secure better access in high-value markets abroad. This would mean moving from a defensive posture to one that uses India’s agricultural power as a bargaining chip.

Tables in this document were compiled with the assistance of AI.

Authors