To safeguard India’s food security and promote better health outcomes, the Global Trade Research Initiative (GTRI) underscores the significance of maintaining high import duties and resisting pressure to open the agricultural sector. A recent report by GTRI emphasizes the need for India to reduce its reliance on imported vegetable oils, a sector in which it is the world’s largest importer.
The report reveals that India’s vegetable oil imports are projected to double to USD 20.8 billion in the fiscal year 2023–24, highlighting the urgency of addressing this issue. The United States and the European Union employ advanced technology, high tariffs, and substantial subsidies to boost agricultural exports, creating a competitive landscape.
By maintaining high import duties on sensitive agricultural commodities like rice and resisting external pressure to lower tariffs, India aims to preserve its self-sufficiency and ensure food security for its burgeoning population. GTRI Co-Founder Ajay Srivastava commends India’s approach, stating that the country’s self-sufficiency in almost all agricultural products is a result of policies like the green and white revolution, high import tariffs, and active negotiations at the World Trade Organization (WTO).
While emphasizing the importance of continuing this approach, the report predicts that developing countries like India will face increased pressure from developed and agri-exporting nations to reduce duties and subsidies on agricultural commodities. India’s high import tariff wall, ranging from 30 to 100% on sensitive items, has played a crucial role in achieving self-sufficiency.
The report also sheds light on challenges in the sugar sector, noting that, despite being the world’s largest sugar exporter after Brazil, India is expected to import sugar significantly in 2023. The rise in sugar imports is attributed to a decline in domestic production caused by weak rains.
To enhance the sustainability of the Indian sugar sector, the report suggests boosting sugarcane yield, addressing water scarcity, and reducing reliance on subsidies. Additionally, the report highlights that India’s agricultural imports, estimated to reach USD 33 billion in 2023, constitute only 4.9% of total merchandise imports.