Congress MP Rahul Gandhi on Wednesday launched a sharp attack on the government over the trade and tariff agreement with the United States, alleging it had compromised the interests of farmers by opening price-sensitive agriculture and dairy segments to American imports.Speaking during a public address and later interacting with reporters, Gandhi accused the administration of yielding to external pressure and said the deal threatened the livelihoods of crores of cultivators, particularly small and marginal farmers. He charged that by allowing greater access to US farm goods, the government had weakened protections that shield domestic producers from heavily subsidised foreign competition.
His remarks follow sustained political debate over the contours of the India–US trade understanding, which aims to ease tariffs, expand market access and deepen supply chain integration between the two economies. Officials have described the arrangement as a calibrated effort to boost exports, attract investment and reduce long-standing trade frictions, while insisting that sensitive sectors would remain protected through quotas and phased implementation.
Gandhi’s criticism centred on agriculture and dairy, sectors that employ a substantial share of the workforce and remain politically sensitive. India’s dairy industry, built on a vast cooperative network and dominated by smallholders owning two to three cattle, has historically resisted full liberalisation. Farm organisations have argued that US producers benefit from scale, advanced logistics and federal support programmes, which could distort competition if imports rise sharply.
“The government should be ashamed,” Gandhi said, asserting that the deal risked undercutting rural incomes at a time when farmers are grappling with input cost pressures and climate variability. He framed the agreement as a broader pattern of policy decisions that, in his view, favour large corporations over primary producers.
Government representatives have rejected the allegation that agriculture has been “sold out”. Commerce ministry officials have maintained that negotiations sought reciprocal access for domestic pharmaceuticals, textiles, engineering goods and services, while retaining safeguard mechanisms. They have pointed to tariff-rate quotas and sanitary and phytosanitary standards that would regulate the pace and scale of farm imports.
Policy analysts note that agriculture accounts for a modest share of bilateral trade compared with technology, defence and energy. Yet its symbolic and social weight is disproportionate. Previous trade talks with partners such as the European Union and Australia also saw protracted discussions over dairy and farm tariffs, reflecting the political salience of rural constituencies.
According to official trade data, the United States is one of India’s largest trading partners, with goods and services trade exceeding $190 billion in the last financial year. Washington has long sought lower tariffs on agricultural commodities, including dairy products, poultry and certain grains, arguing that market access remains constrained. India, for its part, has pursued easier entry for skilled professionals and lower duties on labour-intensive exports.
Economists are divided over the likely impact of incremental liberalisation. Some argue that limited, well-regulated imports can enhance competition, improve quality standards and reduce consumer prices without displacing domestic producers. Others caution that even small tariff reductions in price-sensitive commodities can ripple through supply chains, affecting procurement prices at the farm gate.
Farm unions have expressed concern that exposure to international price volatility could erode the minimum support price regime and cooperative procurement systems. Dairy cooperatives, particularly in western states, have emphasised the need to preserve biosecurity standards and prevent dumping of surplus milk powder.
Opposition parties have seized on the issue to rally support in rural areas, recalling past controversies over farm laws and procurement reforms. Gandhi’s remarks echo broader criticism from Congress leaders who argue that trade negotiations lack transparency and parliamentary scrutiny.
The government counters that modern trade agreements are essential to integrate domestic industry into global value chains, especially as geopolitical shifts reshape supply routes. Officials highlight that other emerging economies are actively pursuing bilateral and plurilateral trade pacts to secure preferential access in advanced markets.
Business groups have broadly welcomed closer economic ties with the United States, citing opportunities in digital services, renewable energy and advanced manufacturing. Export associations argue that improved access for textiles, auto components and pharmaceuticals could offset pressures in agriculture, creating employment in other sectors.
Strategic analysts view the trade framework as part of a wider alignment between New Delhi and Washington across defence cooperation, critical technologies and Indo-Pacific security. They suggest that economic integration complements geopolitical convergence, though it inevitably requires balancing domestic sensitivities.
For rural communities, the debate turns on whether safeguards embedded in the agreement will be sufficient. Implementation details, including tariff schedules, quota thresholds and review clauses, are expected to determine the real-world consequences.