India has decided to defer the imposition of higher duty on food imported from the United States, giving Indian food importers much-needed relief. The higher duties were supposed to be initiated from August 4, 2018, but sources stated that negotiations between the two countries led to the deferment of the tariffs.

Traders from both the countries were hoping for a breakthrough, and it was proposed that food products not be included in the demerit list, which is likely to adversely affect the trade in nuts and dried fruits between the two countries.

Fearing a steep inflation, the food importers even suggested that India hike the duties on non-food items rather. Industry sources stated that in the first week of August 2018, another round of talks were held between officials of the US and India. However, no result came out of the deliberation.

In June, the Government of India announced a 50 per cent hike tariff on agri produce such as apples, almonds and walnuts and industrial products like steel. This would result into an additional tax of $240 million inline with similar tariffs imposed by the US government.

Raju Bhatia, member, Federation of Indian importers, and ambassador, International Nuts and Dried Fruit Council, said that the deferment of the tariff hike was a welcome step. “We hope that tariffs will not be implemented and the two countries will be able to iron out their differences,” he said.

“The tariff imposition has put a lot of pressure on the food importers which would certainly have an inflationary impact,” he said, adding that the domestic Indian production of nuts and dried fruit was not going to fulfill the demand.

“I feel the talks between the two countries thus far have been positive. Although the decision about withdrawing the tariff was not made, concentrated efforts were made from both sides, and we are hopeful that a positive outcome shall be reached,” Bhatia said.

The Indian import of US apples, walnuts and almonds was around $870 million last year.

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