Prices of edible oils have seen a sharp rise on account of costlier imports. According to an IANS report citing industry sources, cooking oil prices are likely to go up further.
Prices of palm oil have increased by as much as Rs 20 per litre in the last 2 months, which in percentage terms is an over 35 percent rise, the report said. The rise in palm oil prices has led to a rally in prices of other edible oils as well.
In the last two months, imports of edible oils from the international market have become costlier. India meets about 70 percent of its cooking oil requirements through imports.
The country imports palm oil, traditionally a cheap vegetable oil choice for Indian consumers, largely from Malaysia and Indonesia. From October, the Indian government raised tax on refined palm oil from Malaysia to 50 percent from 45 percent for a period of six months to curb imports and boost local refining, it said.
However, news reports suggest that the higher duties were on account of Kuala Lumpur's criticism on New Delhi's decision on Article 370 that became effective in August. Malaysian Prime Minister Mahathir Mohamad said at the United Nations that India had "invaded and occupied" Jammu and Kashmir and asked the Indian government to work with Pakistan to resolve the issue.
The Indian government did not make any public remarks about imports of palm oil from Malaysia in this regard. Palm oil is crucial for the Malaysian economy as it made for about 4.5 percent of its total exports last year.
Damages to soybean crops from heavy rains and a lower than expected Rabi oilseed cultivation are also expected to affect oil prices.
Further, a hike in export duty on soy oil by Argentina (from 25 to 30 percent) is going to increase the cost of soy oil imports in India.