Dairy is sensitive sector; no plans to open up in any FTA: Goyal

NEW DELHI — Commerce and Industry Minister Piyush Goyal on Wednesday said dairy is a sensitive sector in India as it involves livelihood issues of small farmers and there are no plans to give duty concessions under any Free Trade Agreement (FTA) in this area.

He said India has not given any duty concessions in the dairy sector even to Switzerland and Norway under the EFTA (European Free Trade Association) trade pact, which was signed in March.

With Australia also, he said, the sector was discussed but India clearly conveyed the sensitivities involved in this area.

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“Our average holding with the farmer is small. It is 2-3 acre farm with 3-4 livestock whereas Australia’s farm and dairy farms are both very large and it would be near impossible for these large and small farms to compete with each other on a common footing.

“We had discussed this issue even three years ago and on earlier occasions also, and dairy is such a sensitive sector that in any of our FTAs across the world, we have not been able to open up the sector with duty concessions,” Goyal told reporters in a joint press conference at Adelaide with Australian Trade Minister Don Farrell.

The minister is in Australia for bilateral talks to promote trade and investments.

Addressed a joint press conference in Adelaide with my Australian counterpart Mr. Don Farrell, Minister of Trade and Tourism, Australia.

Both the nations reiterated the commitment to partner with each other to provide a bouquet of opportunities for businesses, to leverage the… pic.twitter.com/z9gd21DFcq

— Piyush Goyal (@PiyushGoyal) September 25, 2024

He said the sector is open for trade but there are certain customs duties imposed on that.

“We have neither opened up dairy for Europe nor planning to open up…nor have we opened it with Switzerland and Norway with whom we have recently signed EFTA trade agreement,” he said adding “This is the agreement that Switzerland has signed without any component of dairy in it”.

Goyal was responding to a question on India’s hesitancy on removing barriers to Australian exports in sensitive sectors like dairy.

On CECA talks, the Indian minister said that both the countries are aware of each other’s sensitivities.

“So any issue that I can see Australia will be uncomfortable with, I would not like to push, press on that, and likewise our approach has been that if something is very sensitive to a large Indian population given our current status of development, Australia has been very gracious in their understanding of our sensitivities,” he said.

Farrell said that Australia has a lot to offer to India in agriculture, as well as the emerging sectors.

Asked about the progress of talks on CECA, the Australian minister said that in terms of agriculture, “we are talking about the removal of all of the tariffs that weren’t removed at the last process, so we’ve made significant progress”.

“So things like chickpeas, pistachios, and apples…all of the issues, all of the products where there are still tariffs, wine is another one we are seeking to have those tariffs removed,” he said.

On Whyalla steelworks issue, the minister said that he is aware that there have been some discussions between Prime Minister Narendra Modi and his Australian counterpart.

“Obviously steel making is a very important business in Whyalla. As a government we want to see steel making continue, and of course all of those jobs be protected, and we will, of course, continue those discussions between the Prime Minister and the Premier,” he added.

India and Australia implemented an interim trade agreement in December 2022 and now they are in negotiations to widen the scope of the pact through CEPA.

The bilateral trade between the two countries dipped to USD 24 billion in 2023-24 from USD 26 billion in 2022-23. The trade is in favour of Australia as India’s exports stood at USD 7.94 billion in the last fiscal year, while imports were at USD 16.15 billion.

Australia is the 25th largest investor in India with foreign direct investments of USD 1.5 billion during April 2000 and June 2024.

Goyal also announced opening up of the Invest India office soon in Sydney to help promote bilateral investments.

He said that India offers huge opportunities for investments as it has the advantage of four ‘Ds’ – democracy, demographic dividend, demand and decisive leadership.

The two sides are looking to double the bilateral trade to USD 100 billion in the coming years.

Farrell also announced USD 10 million in new grants for Australian businesses, organisations and universities to boost cooperation with India.

By extending the USD 10 million Maitri Grants programme, the government will deliver, firstly, USD 5 million for Australian organisations working on projects that boost trade and innovation, cultural ties and community leaders, and then a further USD 5 million for scholars and fellowships to support Australian universities to host some of the brightest Indian students in their research, on some of “our biggest” shared challenges.

Goyal said that the Invest India office will be set up “shortly” to cover four areas – investment, trade, technology, and tourism. It will have representatives from Invest India, the organisation responsible for building industrial smart cities and townships (NICDC), Export Trade and Guarantee Corporation, and CII.

“We (India) will cross the USD 7 trillion mark by 2030, and the USD 10 trillion mark by 2034,” he added.