New Delhi: In the India-US Bilateral Trade Agreement, ethanol has been classified as a highly sensitive agricultural product, ensuring it remains fully protected from immediate tariff reductions, the Government of India said on Monday, ANI reported.
The Central government clarified that agricultural market access for the United States has been structured according to product sensitivity, in line with India’s approach in previous trade agreements. Under the pact, products are categorized for immediate duty elimination, phased elimination (up to 10 years), tariff reduction, margin of preference, or Tariff Rate Quotas (TRQs).
Ethanol for fuel, along with other sensitive items such as meat, dairy, pulses, oilseeds, and certain fruits, falls under the “carefully crafted exemption category,” safeguarding domestic producers from sudden import competition.
For intermediate products used in India’s food processing industry—such as oils, starches, and albumins—phased elimination of tariffs over up to ten years has been adopted, giving domestic stakeholders time to adjust. Select sensitive products, including certain alcoholic beverages, are subject to tariff reduction mechanisms, while others, like almonds, walnuts, pistachios, and lentils, are permitted under TRQs at limited quantities and reduced duties.
Union Commerce Minister Piyush Goyal said in an interview with ANI that India’s agricultural exports, including ethanol, will face lower reciprocal tariffs than competitors. “Certain items, including tea, coffee, spices, coconut, coconut oil, vegetable wax—and fuel ethanol—remain fully protected under zero or minimal duty concessions,” he noted.
Goyal emphasized that the agreement strengthens market access for Indian farmers, MSMEs, and ethanol producers without compromising domestic supply or pricing. “I can state categorically that India’s farmers and producers will not suffer any loss. On the contrary, India benefits from greater access to the US market,” he said.
India maintains a trade surplus of USD 1.3 billion in agricultural trade with the United States, with exports of USD 3.4 billion and imports of USD 2.1 billion in 2024, government data shows.
