The Hidden Harvest of Tariff Wars: How the U.S. Uses Trade to Push Its Crops, Not Cars
The headlines may make it seem like the world is witnessing a tussle between industrial titans, a fierce standoff over steel, semiconductors, and supercars. But behind the curtain of global trade rhetoric lies a quieter, less glamorous truth—this isn’t just about automobiles and industrial policy. It’s about agriculture. It’s about lentils and soybean oil. And, more tellingly, it’s about how rich countries like the United States are using trade negotiations to force open markets in developing nations for their subsidized, surplus produce, all under the banner of “free trade.”
In April 2025, U.S. President Donald Trump pulled one of his signature shock moves by slapping a 26 percent tariff on imports from several countries, India included. Amid rising global concern and domestic backlash, the U.S. soon walked back part of that decision and announced a 90-day pause—effectively buying time to pressure nations like India into trade concessions in the name of diplomatic compromise. The pause was widely reported as a sign of reconciliation, but to anyone paying attention, it looked more like an ultimatum with a ticking clock. India has 90 days to bend—or brace for the full tariff whip.
Trade relations between India and the U.S. have long been an exercise in balancing diplomacy with domestic priorities. The U.S., driven by the demands of its powerful agribusiness lobby and automobile manufacturers, seeks greater access to Indian markets. India, with a population of 1.4 billion and millions of smallholder farmers, is trying to protect its food security, rural livelihoods, and economic autonomy. And in between, a Free Trade Agreement (FTA) remains an elusive prize—stalled not due to lack of interest, but because of the sharp asymmetry in what each side demands and offers.
With the 90-day pause in place, India has used this window to accelerate trade talks, hoping to secure better terms while avoiding the trap of sudden market exposure. But the structure of these negotiations is revealing. On the U.S. side, the narrative is dominated by auto tariffs, especially the high duties that India imposes on imported cars—sometimes exceeding 100 percent. These are easy talking points, marketable to voters and media alike. But scratch beneath the surface and you’ll find that the real U.S. ambition lies elsewhere: agriculture.
Let’s look at the numbers. U.S. automobile exports to India currently stand at around 500 million dollars. Even in a best-case scenario where India slashes tariffs, the U.S. auto industry might push this up to 750 million dollars—assuming Indian buyers suddenly develop an appetite for larger, pricier, fuel-hungry vehicles. That’s a stretch, given India’s consumer patterns and infrastructure. Cars like Teslas may find a niche, but for the broader U.S. car industry, India is not the goldmine it’s made out to be.
Now consider agriculture. The U.S. is pushing hard for India to reduce tariffs on several agricultural products—lentils, tree nuts, fruits like cranberries and blueberries, animal feed, and especially soybean oil. And in these sectors, the stakes are far higher.
Take lentils. India produces about 1.1 million metric tons of lentils annually but consumes far more, making it reliant on imports. In 2023 alone, India imported approximately 1.2 million metric tons of lentils. The U.S. has been a major supplier, exporting around 700 to 800 million dollars worth of lentils to India in favorable years. With predictable tariff reductions and year-round access, U.S. lentil exports could easily cross 850 million dollars annually. That’s already more than the automobile sector offers post-liberalization. Yet, when was the last time lentils made global trade headlines?
Then there’s the real beast—soybean oil. India’s edible oil market is massive, with consumption outpacing domestic production year after year. In 2024, India produced about 2 million metric tons of soybean oil, but imported 3.5 million metric tons more—worth roughly 4 billion dollars. This import dependence is projected to persist, with the soybean oil market expected to grow to 5.6 billion dollars by 2033.
Currently, the U.S. captures a very small share of this market. Most of India’s imports come from Argentina and Brazil, largely because of price advantages and India’s ban on genetically modified (GM) soybeans—a norm in U.S. agriculture. The U.S. soybean industry, heavily subsidized and immensely productive, has long struggled to break into the Indian market for this reason.
But with trade negotiations on the table and tariff reductions being discussed, U.S. exporters are sharpening their knives. If India were to relax its stance on GM imports and reduce tariffs, the U.S. could corner 30 to 35 percent of India’s soybean oil imports. That would translate to 1 to 1.2 million metric tons, worth between 1.1 and 1.4 billion dollars annually. That’s not just a foot in the door—it’s a windfall. All the U.S. needs is for India to blink.
Now stack that against the 250 million dollar bump the U.S. might get from automobile exports if tariffs drop. It becomes glaringly obvious: agriculture is where the real value lies. Cars are the smokescreen. Soybeans and lentils are the prize.
But this prize comes at a cost. India’s agricultural economy is not an abstract statistic—it is the lifeline for over half of its population. Allowing cheap, subsidized American produce into Indian markets could spell disaster for smallholder farmers. These farmers already face an uphill battle—erratic monsoons, rising input costs, and stagnant market prices. If they are suddenly made to compete with the scale and subsidies of American agribusiness, their livelihoods will be obliterated. Lentil prices will fall. Oilseed cultivators will be undercut. A short-term drop in consumer prices will come at the cost of long-term rural collapse.
Soybean oil is especially dangerous ground. Beyond the economic consequences, there are also serious environmental and health concerns around GM crops. India has long held a firm line on not allowing GM soybean oil for human consumption. The moment that changes, a floodgate opens—both for imports and for domestic lobbying to allow GM cultivation in Indian fields. That could lead to irreversible ecological and policy consequences.
India must resist the temptation of short-term trade relief. It must hold its ground on GM regulations. It must protect its farmers from being turned into collateral damage in a trade war designed not for mutual growth, but for the benefit of well-oiled U.S. lobbies.
Because at the end of the day, this isn’t just about trade. It’s about sovereignty. It’s about whether developing nations have the right to set their own food policies without being bullied into compliance. It’s about whether a country like India will stand up for its farmers—or roll over for American soy.
Behind the diplomatic smiles and strategic dialogues, what’s playing out is economic coercion dressed up as trade liberalization. A game where the rules are written by the rich, the winners are the powerful, and the losers are left to fend for themselves in deflating rural markets and flooded grain mandis.
This is not free trade. This is forced dependence. And India must say no.
