What Happened
- Maharashtra Chief Minister Devendra Fadnavis assured farmers that soybean and cotton interests are fully protected under the India-US interim trade deal announced on 7 February 2026.
- Fadnavis stated categorically that no soybean or cotton will be imported from the US under the deal, dismissing claims to the contrary as "rumours" spread by opposition parties.
- He claimed that soybean prices fell in domestic markets due to misinformation about the deal's agricultural provisions, not due to any actual policy change.
- The Union Agriculture Minister separately confirmed that no tariff concessions of any kind have been given on soybean, corn, rice, wheat, sugar, coarse grains, poultry, dairy, oilseeds, ethanol, and tobacco.
- Fadnavis highlighted that the trade deal would open new investment opportunities in Maharashtra, particularly in data centres, artificial intelligence, and modern technologies.
Static Topic Bridges
India's Oilseed Economy and Soybean Production
India is the fifth-largest producer of soybeans globally, with production concentrated in Madhya Pradesh, Maharashtra, and Rajasthan. Despite significant production, India remains a major importer of edible oils, meeting only about 40% of its demand domestically. The soybean value chain supports millions of smallholder farmers, making it politically sensitive.
- Major soybean-producing states: Madhya Pradesh (~45% of national output), Maharashtra (~35%), Rajasthan (~12%)
- India's total edible oil demand: approximately 26 million tonnes annually
- Domestic edible oil production: approximately 9.6 million tonnes (2025-26)
- Import dependence for edible oils: ~60% of total consumption
- Soybean oil imports primarily from Argentina and Brazil; India imported ~5-5.5 MT of soybean oil in 2024-25
- Minimum Support Price (MSP) for soybean (2025-26): Rs 4,892 per quintal
Connection to this news: Maharashtra's soybean farmers are particularly vulnerable to import competition given that the state accounts for about 35% of national soybean production. Fadnavis's intervention was aimed at calming farmer anxiety and stabilising domestic prices that fell on speculation about the deal's agricultural provisions.
India's Cotton Sector and Global Trade Dynamics
India is the largest producer of cotton globally and the second-largest exporter. The cotton sector provides livelihoods to approximately 6 million farmers across 12 major cotton-growing states. Cotton cultivation occupies about 12.5 million hectares in India, with Maharashtra being one of the top three producing states alongside Gujarat and Telangana.
- India's cotton production (2024-25): approximately 30-31 million bales (of 170 kg each)
- Major cotton states: Gujarat, Maharashtra, Telangana, Madhya Pradesh, Rajasthan, Karnataka
- India's share of global cotton production: approximately 23-25%
- Cotton MSP (medium staple, 2025-26): Rs 7,521 per quintal
- US cotton imports into India face duties and are minimal; India is largely self-sufficient and a net exporter
- Technology Mission on Cotton (TMC) launched in 2000 to improve yield and quality
Connection to this news: Unlike soybean oil where India is import-dependent, India is a net cotton exporter. Fadnavis's assurance on cotton was directed at dispelling fears about US cotton flooding Indian markets under the trade deal, particularly among Maharashtra's Vidarbha cotton farmers who face persistent agrarian distress.
Role of Minimum Support Price in Indian Agriculture
The Minimum Support Price (MSP) is a form of market intervention by the Government of India to insure agricultural producers against sharp declines in farm prices. The Commission for Agricultural Costs and Prices (CACP) recommends MSPs for 22 mandated crops and fair and remunerative price (FRP) for sugarcane each season.
- MSP currently covers 22 crops plus sugarcane (FRP)
- Categories: 14 kharif crops, 6 rabi crops, 2 commercial crops
- MSP calculation based on CACP formula factoring in A2+FL costs (comprehensive cost including family labour)
- Government policy since 2018-19: MSP set at minimum 1.5 times the A2+FL cost of production
- Procurement at MSP is not legally guaranteed; actual procurement varies by crop and state
- Key procuring agencies: FCI (cereals), NAFED and CCI (oilseeds and cotton)
Connection to this news: The fear among soybean and cotton farmers is that cheaper US imports could push market prices below MSP levels, making procurement operations financially unviable. Fadnavis's assurance that these commodities are excluded from the trade deal directly addresses this concern, as any market price depression would undermine the MSP support framework.
Key Facts & Data
- Products excluded from India-US trade deal tariff cuts: soybean, cotton, corn, rice, wheat, sugar, coarse grains, poultry, dairy, oilseeds, ethanol, tobacco
- Maharashtra's share of national soybean production: approximately 35%
- India's edible oil import dependence: ~60% of total domestic demand
- India's cotton production: ~30-31 million bales (2024-25), world's largest producer
- India-US trade deal investment potential for Maharashtra: data centres, AI, modern technology sectors
- US reciprocal tariff on India reduced from 25% to 18%
- India committed $500 billion in US purchases over five years across energy, technology, aircraft, precious metals, and coal