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On dairy imports, a firm ‘no’ to Donald Trump

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Amid reports that the visit of US President Donald Trump will be an occasion to ask India to open itself to dairy (and poultry) imports from the US, it is good to look at the global and notably the US dairy industry and its practices. The US has had a thriving dairy industry that traditionally focussed on its domestic market. This changed in the early 2000s. In the decade from 2004 to 2014, for an example, US dairy exports grew four-fold, from US $1.6 billion to almost US $6.8 billion, according to the United States Department of Agriculture (USDA), riding on free trade agreements and opening up of world markets. This made the United States the world’s third-largest dairy product exporter, behind New Zealand and the European Union. But the story took a turn in 2015, when US dairy exports fell by almost 30 per cent for a variety of reasons. Among them was a Russian ban on dairy imports and changes in milk supply quotas in the European Union. As the USDA put it: “The US dairy industry will be challenged to increase market share in the years to come.”

The challenges continue to this day. For example, Skimmed Milk Powder, SMP, which is among the top two products of dairy exports from the United States (the other being cheese) faced some resistance in 2019. A USAD circular notes that SMP “faced strong competition in the global market that, coupled with retaliatory tariffs imposed by several major importing countries, undercut shipments.”

Access to the vast Indian market is therefore an important concession that the US would look to push for. However, they pose many unique problems for India, the first of which is that Indians have a special relationship with milk as food, seen as not only wholesome nourishment for children and adults alike but much more. Milk is also used to celebrate many Indian festivals, as offering to Gods, an important part of the tradition of temple........

© Free Press Journal