What Happened
- Jammu & Kashmir Chief Minister Omar Abdullah warned that the India-US trade deal would cause severe losses for Kashmir's fruit growers, stating "I only see losses" from the agreement.
- The trade deal includes provisions to reduce or eliminate tariffs on US agricultural products entering India, including fresh and processed fruits, tree nuts, and dry fruits, all of which are major products of J&K.
- The Kashmir Valley Fruit Growers-cum-Dealers' Union wrote to PM Modi urging import duty on American and European apples to be raised above 100%.
- Abdullah argued that while tree nuts and dry fruits are being allowed at zero duty, J&K's apple sector should have been specifically protected.
- Reactions among growers are mixed: some see it as a threat to livelihoods, while others view it as an opportunity to improve quality and competitiveness.
Static Topic Bridges
India's Horticulture Sector and Kashmir's Apple Economy
India is the world's second-largest producer of fruits and vegetables. Jammu & Kashmir accounts for approximately 75-77% of India's total apple production, making apples the backbone of Kashmir's economy. The horticulture sector contributes about 24.5% of J&K's GDP from just 8% of its land area and supports over 700,000 families directly or indirectly. India's apple production stood at approximately 2,054 thousand tonnes in 2024, with Himachal Pradesh contributing another ~20%.
- J&K's share of India's apple production: ~75-77%
- Horticulture contribution to J&K GDP: 24.5%
- Families dependent on horticulture in J&K: 700,000+
- India's apple production (2024): ~2,054 thousand tonnes
- Other key J&K horticultural products: Walnuts, almonds, saffron, cherries
Connection to this news: The reduction of tariffs on US apples and tree nuts directly threatens the economic lifeline of lakhs of Kashmiri families, as cheaper imports could undercut domestic prices for fruits that constitute the region's primary agricultural output.
Agricultural Tariffs and WTO Obligations
India has historically maintained high agricultural tariffs, averaging ~37% across agricultural goods, as a means of protecting small and marginal farmers. Under WTO rules, India's bound tariff rates (maximum permissible) for most agricultural products are significantly higher than applied rates, giving India policy space. India previously imposed a 50% duty on US apples, plus an additional 20% retaliatory tariff in 2019 in response to US Section 232 tariffs on Indian steel and aluminium. WTO's Agreement on Agriculture (AoA), negotiated during the Uruguay Round (1986-1994), governs global agricultural trade through three pillars: market access, domestic support, and export subsidies.
- WTO Agreement on Agriculture: Uruguay Round (1986-1994), effective January 1, 1995
- Three pillars of AoA: Market access, domestic support, export subsidies
- India's average agricultural tariff: ~37%
- Previous tariff on US apples: ~50% + 20% retaliatory duty (2019)
- India's WTO classification: Developing country (entitled to special and differential treatment)
Connection to this news: The proposed tariff reduction on US fruits under the trade deal represents a significant departure from India's traditional protectionist stance on agriculture, raising questions about the adequacy of safeguard mechanisms for vulnerable farming communities.
India-US Trade Relations and Reciprocal Tariffs
The India-US bilateral trade relationship is one of the largest globally. On February 2, 2026, the two countries announced a framework for an Interim Bilateral Trade Agreement, with the US reducing reciprocal tariffs on Indian goods from 25% to 18%. In exchange, India agreed to eliminate or reduce tariffs on US industrial goods and a wide range of agricultural products. India intends to purchase $500 billion in US products over five years, including energy, aircraft, and technology. The US-India bilateral trade deficit has been a longstanding point of friction, with the US recording a goods trade deficit with India.
- India-US Interim Trade Deal: Announced February 2, 2026
- US reciprocal tariff on India: Reduced from 25% to 18%
- India's commitments: Eliminate/reduce tariffs on US industrial and agricultural goods
- Purchase commitment: $500 billion in US products over 5 years
- Sectors covered: Energy, agriculture, defense, aircraft, technology, pharmaceuticals
Connection to this news: Omar Abdullah's concerns highlight the domestic distributional impact of trade liberalization, where macro-level trade benefits may impose concentrated costs on specific regions and communities like Kashmir's fruit growers.
Key Facts & Data
- J&K produces ~75-77% of India's apples
- Horticulture supports 700,000+ families in J&K
- Previous tariff on US apples: ~70% (50% base + 20% retaliatory)
- India-US reciprocal tariff: Reduced from 25% to 18% under 2026 deal
- Tree nuts and dry fruits proposed at zero duty under the deal
- Kashmir Valley Fruit Growers Union has demanded import duty above 100% on foreign apples