India–US Trade Agreement: Dairy Sector Sees Opportunity, Farmers Remain Cautious

Yugcharan / 09/02/2026

The recently announced India–United States trade agreement has triggered a wide-ranging debate across the country, particularly among farmer organisations who fear that increased market access to American agricultural products could intensify existing challenges in the domestic farm sector. While farmer groups have voiced strong reservations, leaders from the dairy industry have sought to reassure stakeholders, stating that the agreement safeguards core agricultural interests and may open new opportunities for Indian producers.

At the centre of the discussion is the concern that cheaper imports from the United States could affect prices and livelihoods in India’s highly sensitive agriculture and dairy sectors. Farmer unions argue that Indian farmers, already grappling with rising input costs, climate uncertainties, and market volatility, may find it difficult to compete with large-scale producers from developed economies.

However, senior representatives of the dairy industry have offered a different assessment. According to industry leaders, the trade negotiations were structured to ensure reciprocal benefits, with careful consideration given to protecting domestic producers while improving access for Indian products in overseas markets.

Trade Talks Described as Reciprocal

Senior officials from India’s cooperative dairy sector have emphasised that trade negotiations are inherently a two-way process. They argue that the agreement should not be viewed solely through the lens of imports, but also in terms of expanded export opportunities for Indian agricultural and dairy products.

Industry representatives point out that tariff reductions under the agreement could allow Indian products to reach international markets, including the US, at more competitive rates. This, they say, could benefit a wide network of farmers, cooperatives, and allied industries involved in dairy production and processing.

They have also stressed that agriculture and dairy remain strategically important sectors for India, and any agreement involving them undergoes multiple levels of scrutiny before being finalised.

Focus on Dairy and Cattle Feed

One of the key areas of discussion has been cattle feed, a critical input for the dairy and livestock sector. Large cooperatives in India work with millions of farmers across thousands of villages, handling vast quantities of milk every day. Ensuring consistent access to quality cattle feed is essential for maintaining productivity and farmer incomes.

Dairy sector officials have clarified that cattle feed production in India relies on a mix of domestically available agricultural by-products such as de-oiled rice bran, maize derivatives, oilseed extractions, and molasses. According to them, the country already has sufficient domestic availability of most feed ingredients.

Regarding certain by-products like distillers dried grains with solubles (DDGS), industry experts note that while limited quantities are used in cattle feed, there are practical limits to their inclusion. India has also developed its own capacity to produce such by-products due to the expansion of ethanol manufacturing. As a result, they argue that large-scale imports of these materials offer little additional benefit to the sector.

From this perspective, dairy industry leaders maintain that the trade agreement does not pose a significant risk to cattle feed supply or pricing, nor does it undermine the broader dairy ecosystem.

Farmer Groups Announce Protest

Despite these assurances, farmer organisations remain unconvinced. Several national-level unions have announced a one-day nationwide protest on February 12, expressing opposition to the trade framework. They argue that the agreement could gradually weaken protections for Indian agriculture and expose farmers to unfair competition from multinational corporations.

In public statements, farmer groups have described the deal as contrary to assurances previously given about keeping agriculture and dairy interests insulated from free trade arrangements. They have called for greater transparency and wider consultations with farmer representatives before implementing any provisions that may affect rural livelihoods.

The unions have also demanded that the government place the full details of the agreement in the public domain and conduct a comprehensive impact assessment focused on small and marginal farmers.

Balancing Growth and Protection

Policy analysts note that the contrasting reactions highlight the complexity of trade negotiations involving agriculture. While export-oriented sectors see potential for growth, farming communities often worry about long-term consequences, especially in a country where agriculture supports a large portion of the population.

Experts suggest that the success of the agreement will ultimately depend on how its provisions are implemented, monitored, and adjusted over time. Safeguard mechanisms, timely policy interventions, and continued dialogue with farmer groups are seen as crucial to preventing unintended impacts.

As discussions continue, the government faces the challenge of balancing global trade ambitions with domestic food security and farmer welfare. The coming weeks, marked by protests and further clarifications, are likely to play a key role in shaping public perception of the India–US trade agreement and its implications for Indian agriculture.