US President Donald Trump has said that India should not “dump” (sell at cheap prices) rice in the US market and he will “deal with” the issue. Trump warned that this ‘problem’ would be easily solved by imposing tariffs. On Monday (December 8, 2025), Trump held a roundtable meeting with representatives of the farming and agriculture sector and key members of his cabinet, especially Finance Minister Scott Besant and Agriculture Minister Brook Rollins, at the ‘White House’, the official residence and office of the US President. He announced $12 billion in federal aid for farmers.

Merrill Kennedy, who runs her family’s agricultural business ‘Kennedy Rice Mill’ in Louisiana, told Trump that rice producers in the southern part of the country are ‘really struggling’ and that other countries are ‘dumping’ rice into the US market, that is, selling rice at very cheap prices.

When Trump asked which countries were selling rice to America at cheaper prices, Kennedy, sitting next to the President, replied, ‘India and Thailand; Even China is selling rice to Puerto Rico at cheap prices. Puerto Rico was once the largest market for American rice. We have not sent rice to Puerto Rico for many years. Kennedy said the tariffs imposed by the Trump administration are working, “but we need to increase them further.”

Why is India allowed to do this? Why did Trump ask this?

Trump then looked at Besant and said, ‘India, tell me about India. Why is India allowed to do this? They will have to pay fees. Do they have discount on rice? To this Besant said, ‘No sir, we are currently negotiating a trade deal with them.’ Kennedy also told Trump that a case was going on against India in the World Trade Organization (WTO). Trump said it could be ‘dealt with very easily.’ He said, ‘This will be solved very quickly by imposing tariffs on those countries which are sending goods illegally. Your problem will be solved in a day, so we have to win the case in the Supreme Court.

India is the world’s largest rice producing country

According to data from the ‘Indian Rice Exports Federation’, India is the world’s largest rice producing country and holds 28 percent share in the global market. It is also the top exporter, with a share of 30.3 percent in global exports in 2024-25. Among the rice varieties that India exports globally, ‘Sona Masoori’ is liked in markets like America and Australia. Trump has imposed 50 percent duty on India, which is the highest in the world. This also includes 25 percent duty on oil purchases from Russia.

India US Trade Deal: The ‘Zero-for-Zero’ tariff model will not be included in the proposed bilateral trade agreement between India and the US. According to government sources, such a strategy is not practical due to a big difference in the level of economic development of the two countries.

Work on big package deal

Under the ‘Zero-for-Ziro’ model, the two countries completely eliminate tariffs on each other’s products. But officials say that such agreements are possible between developed countries like America and European Union, not with a developing country like India.

A senior official told PTI that the trade deal is not on the basis that “if the US removes the tariff on electronics, we will also remove.” He said that India and America are working towards a comprehensive package deal, which will include issues like goods, services and non-tariff barriers.

The negotiation of this deal started in March 2025 and its first phase has been targeted to be completed by September -October. At present, there is a trade of about $ 191 billion between India and the US, which is targeted to take up to $ 500 billion by 2030.

India in better position

Currently, there are yet to have sector -boggling discussions between the two countries. The Government of India believes that it is in a state of better preparation for business agreements compared to other countries. At the same time, the concept of ‘Zero-for-Ziro’ was introduced by Delhi-based think tank ‘Global Trade Research Initiative’ (GTRI), but the Indian government is now looking forward to a balanced and comprehensive dialogue.

The major demands of the US in this conversation include industrial products, electric vehicles, wine, petrochemicals, dairy and agricultural products such as apples, nuts and alfalfa. At the same time, there is a demand for concession in tariffs on labor intensive sectors like Textile, Garment, James and Jemes and Jewelery, Leather, Plastic, Chemicals, Oil Seeds, Shrimp and Horticulture.

$ 35 billion trade surplus from America

Let us tell you that America has been the biggest business partner of India for the last three years. In 2023-24, India recorded a $ 35.3 billion trade surplus with the US. India’s top exports consisted of medicines ($ 8.1 billion), telecom equipment ($ 6.5 billion), precious gems ($ 5.3 billion) and petroleum products ($ 4.1 billion). At the same time, India imported products such as crude oil ($ 4.5 billion), petroleum ($ 3.6 billion), coal ($ 3.4 billion) and aerospace parts ($ 1.3 billion) from the US.

Overall, the Indo-US trade agreement will not be based on any unilateral concessions, but is being created from a long-form and strategic point of view, which will be designed keeping in mind the domestic priorities and global trade balance of the two countries.

Also read: US-China Trade War: America-China trade war can become a threat to India, Moody’s increased concern