Amid ongoing trade deal talks between India and US, there has been a growing focus on the dairy sector that feeds more than 1.4 billion people and employs over 80 million workers.
Both sides are reportedly struggling hard to find a common ground regarding “‘non-veg milk” ahead of Donald Trump’s August 1 deadline.
What is “non-veg” milk?
“Non-veg” milk comes from cows that are fed animal-based products such as meat or blood.
According to various reports, the feed for cattle in the US includes animal products. “Cows are still allowed to eat feed that can include parts of pigs, fish, chicken, horses, even cats or dogs… And cattle can continue to consume pig and horse blood for protein, as well as tallow, a hard fat from rendered cattle parts, as a fattening source,” read a 2004 report by Seattle Post-Intelligencer.
This is not the case in India, where cows are typically fed a strictly vegetarian diet.
What is India’s issue with non-veg milk?
Milk and ghee are used in daily religious rituals in India. Thus India has deemed it a “non-negotiable red line”, citing religious and cultural concerns.
India has insisted that there should be strict certification delineating that imported milk comes from cows that have not been fed animal-based products.
"Imagine eating butter made from the milk of a cow that was fed meat and blood from another cow. India may never allow that," Ajay Srivastava of Global Trade Research Institute (GTRI), a New Delhi-based think tank, told PTI.
India's Department of Animal Husbandry and Dairying mandates veterinary certification for food imports.
What does the US say?
The US has termed India's demands an "unnecessary trade barrier". A senior government official told India Today TV earlier in July that "there is no question of conceding on dairy. That's a red line".
The US also raised the matter at the World Trade Organisation (WTO). According to Times of India, the US hinted that India's updated dairy certification, implemented in November 2024, does not state such concerns.
What happens if India opens up its dairy sector to the US?
The US wants access to the Indian market as it is the world's largest milk producer and consumer. However, it would mean the entry of cheaper US dairy products. This, in turn, would drive domestic prices down and impact the economic stability of farmers.
According to an analysis by SBI, India could face an annual loss of Rs 1.03 lakh crore if it allows US dairy imports, ANI reported.
A report by Livemint said that India’s dairy sector contributes around 2.5%-3% to the national Gross Value Added (GVA), totalling Rs 7.5-Rs 9 lakh crore. GVA is the total value of goods and services produced in the economy after deducting the cost of inputs and raw materials.
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