New Delhi: Leader of the Opposition in the Lok Sabha and Congress MP Rahul Gandhi on Saturday accused Prime Minister Narendra Modi and his government of misleading the country on the tariff provisions in the India-US interim trade agreement.
He said the deal would adversely impact Indian cotton farmers and textile exporters. Rahul Gandhi pointed out that Indian textiles are subject to an 18 percent tariff in the US. Meanwhile, Bangladesh is being granted a zero percent tariff on textile exports on the condition that it imports American cotton. Questioning the policy framework, he alleged that importing American cotton would harm domestic farmers, while not importing it would harm the textile industry. He further claimed that Bangladesh is hinting at reducing or even stopping cotton imports from India, which could further worsen the situation for Indian producers.
In a post on social media, the Congress MP wrote, “18% tariff vs. zero%. I’ll explain how the expert liar Prime Minister and his cabinet are spreading confusion on this issue. How they are deceiving India’s cotton farmers and textile exporters through the India-US trade deal. Bangladesh is being given the benefit of a zero% tariff on garment exports to the US, with the only condition being that they import American cotton. After the announcement of an 18% tariff on Indian clothing,
When I raised a question in Parliament about the special exemption being given to Bangladesh, a minister in the Modi government responded: “If we want the same benefits, we will have to import cotton from the US.” Why was this kept hidden from the country until now?” He said that this agreement would push millions of people into unemployment and economic hardship.
He also criticized the government’s approach to negotiations, saying that a deal in the national interest should have protected both cotton farmers and textile exporters. The post read, “And what kind of policy is this? Is this really a choice, or is it a trap designed to push us into a situation of “well ahead, a ditch behind”? If we import American cotton, our own farmers will be ruined.
If we don’t import it, our textile industry will lag behind and collapse, and now Bangladesh is also signaling that it may reduce or even stop importing cotton from India.
The post further read, “The textile industry and cotton cultivation are the backbone of India’s livelihood. The livelihoods of millions of people depend on these sectors. Attacking these sectors means pushing millions of families into unemployment and economic crisis.
A forward-thinking government, with the best interests of the country in mind, would have struck a deal that would protect and ensure the prosperity of both cotton farmers and textile exporters, but the exact opposite has happened. Their ministers have brokered an agreement that is likely to cause severe damage to both sectors.”
The India-US interim agreement, announced last week, serves as a framework for a mutually beneficial trade pact between the two countries. The agreement will eliminate or reduce tariffs on US industrial goods and a variety of food and agricultural products, including dried distillers’ grains, red sorghum for animal feed, tree nuts, fresh and processed fruits, soybean oil, wine and spirits, and other products.
In return, the US will impose a reciprocal tariff of 18% on selected Indian goods, including clothing, leather, footwear, plastics, rubber, organic chemicals, home decor, artisan products, and some machinery. Upon full implementation, US tariffs will be eliminated on items such as generic pharmaceuticals, gems and diamonds, and aircraft parts.
