India’s farm ministry has proposed that the government cut the 30 per cent import duty on oilseeds in the Budget to be unveiled on Saturday to help local refiners make use of unutilised capacity, a senior ministry official said.
The world’s leading cooking oil importer buys nearly 60 per cent of its annual demand of 18-19 million tonnes (mt) from countries such as Indonesia and Malaysia but refiners are operating at only 40-45 per cent of their capacity of 20 mt.
This has prompted the Solvent Extractors’ Association of India, a grouping of refiners, to lobby the government to make cheaper oilseeds available in the country by cutting the duty to 10 per cent.
“We have sent a proposal to cut the import tax on oilseeds to the finance ministry for its call in the budget,” the farm ministry official told Reuters. A cut would also help bring down inflation, the official added, declining to be named.
Spokesmen for the farm and finance ministries declined to comment.
India’s annual oilseeds output has stagnated at 29-33 mt in the last five years despite the government’s attempts to raise cooking oil supplies beyond seven-eight mt.
The world’s leading cooking oil importer buys nearly 60 per cent of its annual demand of 18-19 million tonnes (mt) from countries such as Indonesia and Malaysia but refiners are operating at only 40-45 per cent of their capacity of 20 mt.
This has prompted the Solvent Extractors’ Association of India, a grouping of refiners, to lobby the government to make cheaper oilseeds available in the country by cutting the duty to 10 per cent.
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A poor monsoon last year is expected to cut India’s rapeseed and sunflower output in the current crop year to June, squeezing supplies for the $25 billion cooking oil industry.
“We have sent a proposal to cut the import tax on oilseeds to the finance ministry for its call in the budget,” the farm ministry official told Reuters. A cut would also help bring down inflation, the official added, declining to be named.
Spokesmen for the farm and finance ministries declined to comment.
India’s annual oilseeds output has stagnated at 29-33 mt in the last five years despite the government’s attempts to raise cooking oil supplies beyond seven-eight mt.