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Trump's remarks aside, India and US move forward on easing shrimp, apple and alcohol trade rules

Trump's remarks aside, India and US move forward on easing shrimp, apple and alcohol trade rules

Time of India13-05-2025

Despite trade tensions, the US and India are quietly working to resolve trade barriers. India is considering easing import rules for US apples by replacing strict certifications with simpler declarations. Simultaneously, discussions are underway to finalize a Regional Partnership Agreement for shrimp trade, aiming to reduce rejections and expedite clearances, potentially by year-end.
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( Originally published on May 13, 2025 )
New Delhi: Amid Donald Trump's latest comments linking the fate of Indo-US trade with the recent India-Pakistan border standoff, considerable progress is quietly being made between the two governments to ease up on procedural barriers weighing down bilateral trade involving several items.Case in point: Considerable progress has been made over the last fortnight to ease the import of US apples and other food items as well as lessen the pain points for export of the Indian shrimp to the US, ET has learnt. United States Food and Drug Administration (FDA) team, in fact, was in India last week to hold talks on the shrimp issue, for an "in-country assessment" that is expected to lead to a key agreement by the year-end.At India's end, significant procedural overhaul is expected to ease up the import of US apples that was also red-flagged in the March 31 United States Trade Representative (USTR) report.Since 2021, India's rulebooks mandate that apple imports will only be permitted with a 'non-GM (genetically modified) origin' and 'GM-free' certificates. The US has complained repeatedly, including at the World Trade Organization, that its apple exports to India have been heavily disrupted due to the certification requirement as the US Department of Agriculture does not issue such certificates.ET gathers that a fresh proposal is currently being discussed by the Indian government to ease the process by replacing the certification requirement with a simpler "declaration" one, with a USFDA declaration stating it will ensure no GM apples or products will be exported to India, in line with the latter's policy and this alone should suffice. This may be further validated by the Indian embassy/consulates in the US if required.Indian authorities, however, will retain the right to inspect in such a scenario, it is proposed.The relaxation will be significant as India is a major importer of American apples. More than a million boxes of US apples are said to have arrived in India in 2024.Similar procedural concessions are being mulled on a range of imported US items, starting with Ready to Drink (RTD) alcohol. India currently only permits beverages with an alcohol content of 0.5-8% in the "low alcohol beverages" category but will soon be notifying a fresh categorisation permitting a near 10%-15% alcohol content in this category.Similar concessions are expected on import of US Alfalfa hay and the Distiller's Dried Grains with Solubles (DDGS) for animal feed, the former being ready for a final go ahead while the DDGS may take longer due to Genetic Engineering Appraisal Committee requirements.For India, it is the shrimp export issue that is crucial. The biggest exporter of shrimp to the US, India clocked $2.7 billion in the last financial year. However, it now faces nearly 18% US tariff under the Trump regime which is hitting the business hard.While the tariff negotiations are underway, India, on the other side, also has other dampeners impacting the Indo-US shrimp trade. Several Indian consignments are frequently rejected due to a variety of reasons, which include suspected antibiotic residue to labelling errors, hygiene concerns and so on. The first half of 2025 itself has seen several such rejections.It is in this backdrop that a USFDA team was in India and on the table is a road to inking a Regional Partnership agreement (RPA) on shrimp trade which will boost the Indian industry considerably. The USFDA already has an RPA with Ecuador since 2023 which is India's competitor on the shrimp trade.A US-India shrimp RPA, with a clearer protocol and auditing mechanism on seafood import safety, is expected to minimise consignment rejections and expedite clearances in the US significantly. Progress is quietly being made to attempt the RPA by the year-end itself, ET has gathered.The USFDA team visited India and held discussions with India's Marine Products Export Development Authority on the same on May 5-6. Teams are also learnt to be currently conducting on-site related assessments on regulatory aspects with various other stakeholder ministries and departments on site, ET has learnt.

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