US Lowers Import Duties to Combat Rising Food Prices
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US President Donald Trump has announced a significant reduction in import duties on nearly 200 food, farm, and agricultural items, aiming to combat rising domestic food prices. This decision, reported by the Times of India, is poised to benefit Indian exporters, particularly in the spice and tea sectors.
Indian spice exports to the US were valued at over $500 million in 2024, with the US also importing tea and coffee from India worth nearly $83 million during the same period. Included in the duty waiver are spices like black pepper, cloves, cumin, cardamom, turmeric, and ginger, alongside various nuts such as cashews, which make up about 20% of US imports.
However, notable exclusions include Indian seafood and basmati rice, which remain under heavy tariffs. The exemptions will boost around $1 billion in agricultural exports from India, with processed food products, spices, and various fruits and nuts standing to gain significantly.
Indian government officials estimate that these reductions will create a more level playing field for Indian agricultural products, enhancing their competitiveness in the US market. Trump’s decision is partly a response to growing voter dissatisfaction linked to rising living costs, a concern highlighted by recent electoral setbacks for the GOP.
The President has floated the idea of using tariff revenue for direct rebates to Americans while also launching an investigation into the meatpacking industry due to high prices. US trade associations and economic commentators have expressed relief at the tariff rollback, which aims to alleviate pressure on consumers despite previous claims that tariffs had not driven up living costs.
This move, announced through an executive order, comes during a period of heightened scrutiny over affordability issues, which have intensified amid the current economic landscape. The exemptions, while beneficial, represent only a fraction of the overall trade dynamics between the US and India, as the two countries navigate complex economic ties.