India has been trying to conclude a number of bilateral trade deals after pulling out of a China-backed regional pact because of opposition from dairy farmers.
Citing sources close to the Prime Minister Narendra Modi’, news media in India say he’s reluctant to go against the powerful dairy lobby.
At stake is the livelihood of millions of small-scale dairy farmers who are not big or modern enough to withstand competition from imports.
Trade negotiations are also being explored with Australia and New Zealand.
The dairy industry is a major component of the proposed India-European Free Trade Association, which includes Iceland, Liechtenstein, Norway and Switzerland, the sources inside Modi’s government said.
The latest casualty of domestic opposition is a proposed ‘limited’ India-U.S. trade deal, which is being negotiated since 2018 to resolve pending issues, the sources said.
The pact, which was almost firmed up, is stuck on the insistence of the U.S. on more dairy concessions and India’s reluctance to do so due to the industry’s aversion, they said.
“We will never allow it,” said R.S. Sodhi, managing director of the Gujarat Cooperative Milk Marketing Federation, the nation’s biggest dairy cooperative that sells its products under the Amul brand. “We will oppose it tooth and nail,” he said.
None of this is surprising. Dairy farmers all around the world owe their livelihoods to government subsidies, protection and regulations.
