Source: The post India’s agricultural exports grow despite global challenges has been created, based on the article “India’s rising farm exports” published in “Indian Express” on 11th August 2025
UPSC Syllabus Topic: GS Paper 3-Agriculture
Context: India’s overall exports in 2024-25 showed marginal growth, but agricultural exports surged despite potential global trade disruptions, including US tariffs. Strong farm performance contrasts with flat merchandise exports, driven by easing restrictions, favourable weather, and global supply shortages in key commodities. India’s agricultural exports grow despite global challenges
Overall Export Performance
- Marginal Growth in Merchandise Exports: India exported goods worth $437.4 billion in 2024-25, a slight 0.1% rise from the previous year. The April–June 2025 period saw a 1.7% year-on-year increase to $112 billion.
- Minister’s Confidence Despite Trade Threats: Commerce Minister Piyush Goyal expressed optimism for higher exports in 2025-26, even with potential setbacks from US President Trump’s proposed 50% tariff on Indian goods.
Agricultural Export Growth
- Consistent Upward Trend: Agricultural exports rose 6.4% to $51.9 billion in 2024-25, with April–June 2025 showing 5.8% growth over the previous year. They could reach $55 billion in 2025-26, surpassing the 2022-23 record of $53.2 billion.
- Historical Patterns and Price Influence: From 2003-04 to 2013-14, farm exports jumped from $7.5 billion to $43.3 billion, dipped until 2020-21, then peaked at $53.2 billion in 2022-23, aided by high global agri-commodity prices.
- Impact of Government Restrictions: The 2023-24 drought and export bans on wheat, rice, sugar, and onions reduced shipments. Improved monsoons in 2024-25 allowed gradual easing of restrictions, especially benefiting commodities like sugar.
Drivers of Current Performance
- Strong Growth Across Key Commodities: Marine products, non-basmati rice, buffalo meat, coffee, tobacco, and fruits & vegetables posted impressive growth in early 2025-26.
- Global Supply Shortages: Indian coffee exports rose due to poor harvests in Brazil and Vietnam. Tobacco exports benefited from shortfalls in Brazil and Zimbabwe.
- Risks from US Tariffs: The US, a major buyer of marine products, coffee, and other goods, plans a 50% tariff from August 27. This could depress prices and reduce Indian export competitiveness, especially if Brazil diverts surplus coffee to global markets.
Agricultural Trade Balance
- Positive but Shrinking Surplus: In 2024-25, agricultural exports ($51.9 billion) exceeded imports ($38.5 billion), yielding a $13.4 billion surplus, down from $27.7 billion in 2013-14 due to faster import growth.
- Concentrated Import Basket: Over two-thirds of imports were vegetable oils, pulses, and fresh fruits. Tree nuts, mainly from the US, formed a significant share.
- Import Trends in Key Commodities: Pulses imports hit a record 7.3 million tonnes in 2024-25 after duty cuts due to drought but declined this year with better harvests. Vegetable oil imports continue rising, and declining domestic cotton and natural rubber output has increased dependence on imports.
Question for practice:
Examine the factors contributing to the recent surge in India’s agricultural exports and assess the potential impact of US tariff measures on this growth.
