Govt Hikes Import Duty On Crude, Palm Oil To Boost Local Prices

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The government on Friday hiked the import duty on crude palm oil to 15 per cent from 7.5 per cent and on refined to 25 per cent from 15 per cent to curb cheaper shipments and boost local prices for supporting domestic farmers and refiners.

The import duties on other crude edible oils like soya and sunflower have been raised to 17.5 per cent from 12.5 per cent, according to a notification issued by the Central Board of Excise and Customs (CBEC).

Govt Hikes Import Duty On Crude, Palm Oil To Boost Local Prices

The hike in import duty of crude and refined palm oil will help restrict cheaper imports from Malaysia and Indonesia and benefit farmers which are in distress due to fall in prices of oilseeds below minimum support price because of bumper production.

On July 27, an inter-ministerial panel headed by Finance Minister Arun Jaitley had reviewed edible oil availability in the country and discussed ways to deal with rising imports.

A committee was set up later to look into import duty structure for checking cheap cooking oil shipments.

Edible oil industry body Solvent Extractors' Association (SEA) welcomed the step, saying the move would help farmers to some extent but wanted duty difference between the crude palm oil and refined palm oil to be 15 per cent to support domestic processors.

"This is a welcome step to support the farmers. At the same time, the government could have raised the duty difference between crude palm oil and refined palmolein to 12.5-15 per cent to support domestic refiners for value addition," SEA Executive Director B V Mehta told PTI.

He said the decision would help in restricting cheaper imports to protect domestic farmers and processors.

"We import 70 per cent of the edible oil requirement. So, the landed cost of imported oil be such that it do not affect domestic farmers and processors," Mehta said.

India imports about 14.5 million tonnes (mt) of vegetable oils (edible and non-edible) per year to meet domestic demand.

Vegetable oil imports increased by 15 per cent in June at 1.344 mt, according to industry data.

In the first eight months of the current 2016-17 oil marketing year, the import of vegetable oils rose marginally at 9.863 mt compared to 9.763 mt.

The move is also expected to give a boost to the sowing of oil seeds in the ongoing season.

Goodreturns.in

Read more about: palm oil, crude
Story first published: Saturday, August 12, 2017, 10:25 [IST]
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