GM bans and high duties squeeze soy imports, straining poultry feed and fueling US trade tensions

India’s Soy Standoff Blocks US Trade Access

<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">India&rsquo;s refusal to import US soybeans is under renewed scrutiny. As trade tensions rise and feed shortages begin to hit home, pressure is building from domestic industries and global partners alike. The reasons behind the block are clear: high import duties, a ban on genetically modified (GM) crops, and political sensitivity. But the stakes are getting higher. Poultry and dairy producers are struggling with rising input costs, and the question now is whether India can afford to stick with its current stance.</span></div>
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<div><strong><span style="font-family: georgia, palatino, serif; font-size: 12pt;">A 57 Percent Barrier That Keeps Soy Out</span></strong></div>
<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">For American soybean exporters, India looks like a massive market that remains firmly out of reach. Even non-GM soybeans face a total import duty of 57 percent, which includes 45 percent basic customs duty, 10 percent social welfare surcharge, and 5 percent IGST.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">In addition, genetically modified soybeans and soymeal, which make up the bulk of US production, are completely banned in India. These two hurdles&mdash;steep tariffs and a GM ban&mdash;make imports nearly impossible, regardless of global supply.</span></div>
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<div><strong><span style="font-family: georgia, palatino, serif; font-size: 12pt;">India&rsquo;s Growing Need for Protein Feed</span></strong></div>
<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">India&rsquo;s poultry and dairy sectors are expanding rapidly. With that growth comes increasing demand for protein-rich feed, especially soymeal, a critical input in animal nutrition.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">The country consumes close to 5 million tonnes of soymeal every year, mostly sourced from domestic production. But that supply is under growing pressure. Domestic shortages have led to rising feed prices, prompting many in the livestock industry to question whether sticking with protectionist policies is sustainable.</span></div>
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<div><strong><span style="font-family: georgia, palatino, serif; font-size: 12pt;">Where India Gets Its Soy</span></strong></div>
<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">India&rsquo;s soybean production is concentrated in five states: Madhya Pradesh, Maharashtra, Rajasthan, Karnataka, and Gujarat. Together, they produce about 12 to 13 million tonnes annually.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">However, soy cultivation is showing signs of stress. Farmers are increasingly shifting to other crops like sugarcane and corn, citing better returns and lower risks. With input costs rising, weather patterns growing erratic, and market prices failing to keep up, soybean is losing its appeal in India&rsquo;s agricultural portfolio. This shrink in cultivation is happening even as demand for soymeal-based feed keeps rising.</span></div>
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<div><strong><span style="font-family: georgia, palatino, serif; font-size: 12pt;">The GM Ban That Won&rsquo;t Budge</span></strong></div>
<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">India&rsquo;s ban on genetically modified food and feed is one of the most rigid in the world. While the US argues that GM soy is globally accepted and safe, Indian authorities and farmer groups strongly disagree.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">In 2023, a NITI Aayog proposal quietly floated the idea of allowing GM soy imports exclusively for animal feed to ease pressure on the poultry and dairy industries. The move was seen as a middle ground, keeping human food supplies untouched. However, facing strong resistance from farmer unions and political groups, the proposal was quietly shelved.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">Today, the GM issue remains politically untouchable. Officials argue that GM crops could pose health, biodiversity, and cultural risks. Even a trial import would be met with fierce public backlash.</span></div>
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<div><strong><span style="font-family: georgia, palatino, serif; font-size: 12pt;">Can India Keep Saying No?</span></strong></div>
<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">With domestic production no longer keeping pace and feed prices rising, voices within the agriculture and poultry sectors are beginning to push for change. Many poultry producers are operating on razor-thin margins. If feed becomes more expensive, prices of meat, milk, and eggs could rise. That cost would ultimately hit consumers.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">Some feed companies are turning to alternatives like DDGS (distillers dried grains with solubles), a by-product of ethanol production, but these do not offer the same protein content as soymeal. Substitutes help, but they are not long-term solutions.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">The situation has become a balancing act: protect rural livelihoods on one hand, and ensure food affordability and industrial competitiveness on the other.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;"><strong>The US Viewpoint: An Unfair Playing Field</strong></span></div>
<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">From the US perspective, India&rsquo;s policies are highly protectionist and unequal. American tariffs on Indian farm exports are minimal, often close to zero. Meanwhile, India&rsquo;s average applied tariff on agricultural imports stands at 39 percent, and for soy it is even higher at 57 percent.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">US trade negotiators see this imbalance as a major roadblock to any meaningful trade deal. Even non-GM soy, which could meet India&rsquo;s safety standards, faces crippling duties and no guaranteed approval process.</span></div>
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<div><strong><span style="font-family: georgia, palatino, serif; font-size: 12pt;">What&rsquo;s Next for Soy Trade?</span></strong></div>
<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">As of mid-2025, the policy landscape remains unchanged. The GM ban is intact, and tariff barriers remain high. US trade officials continue to raise the issue, but Indian policymakers show no signs of shifting their position.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">For India, the priorities are clear: protect farmers, uphold food safety standards, and avoid political fallout. But these come at a cost, one that&rsquo;s increasingly being felt by the industries that rely on affordable protein feed.</span></div>
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<div><span style="font-family: georgia, palatino, serif; font-size: 12pt;">This soy standoff is no longer just about tariffs or trade policy. It is becoming a test of how India balances its domestic interests with global economic pressures. Whether the country can continue down this path without disrupting its livestock economy or its trade relationships remains to be seen.</span></div>

10 જુલાઈ, 2025 | 17:41 IST

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