India cuts import duty on Palm oil |
India on Wednesday slashed import duty on refined palmolein from 50% to 45% while that on crude palm oil from 40% to 37.5% with immediate effect. A notification in this regard has been issued by the finance ministry. The move by the government has been opposed by the industry as it will hurt domestic refiners. According to the notification, the duty cut has been made under the ASEAN agreement and the India-Malaysia Comprehensive Economic Cooperation Agreement. Opposing the move, the Solvent Extractors` Association of India said that after the reduction in import duty, the tax difference between CPO and refined palmolein has been reduced from 10% to 7.5%. The rate cut will have serious impact on domestic palm oil refining industry and oilseeds farmers as they fear that the import of refined palmolein would increase and capacity utilisation of the industry would be affected leading to potential loss of employment. After a long time, the domestic oilseeds had started selling their produce above the minimum support price but Lower import duty would make it difficult to defend the MSP and the newfound enthusiasm of the oilseed farmers would be dampened. The country`s edible oil imports are now touching 70% of the consumption. The duty cut would be counterproductive and contrary to the government`s stated objective of increasing domestic oilseed production.
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