Duty cut in edible oils ruled out

The government today ruled out any plan to reduce the import duty on edible oils such as soyabean oil and palm oil. "There is no proposal (to cut the duty)," Agriculture Minister Sharad Pawar told reporters at the Economic Editors' Conference here.

The government in July had reduced the import duty on crude palm oil to 45 per cent from 50 per cent and on crude soybean oil to 40 per cent from 45 per cent.

There is speculation in the market that government is considering another duty-cut on imported palm and soybean oils to ease domestic rates as global prices have gone up.

Replying to a query, Pawar said the decision to ban palm oil import through Kochi port in Kerala was taken to protect the interests of coconut farmers.

However, he clarified that the government would not put a total ban on palm oil imports as the country is facing shortage of edible oils.

The Keral High Court has already stayed government's decision to prohibit the imports through Kochi port.

Pawar also said the government would soon amend the rules to allow sugar mills make ethanol directly from sugarcane.

The Cabinet last month allowed mills to produce ethanol directly from sugarcane juice, which is currently restricted under Sugar Control Order.

On maize, the minister said there was no reason to ban export of the commodity as prices have come down.

Asked about the Abhijit Sen Committee on futures trading, the minister said the committee report is expected "any time". He said any decision to lift the ban on futures trading of rice, wheat and some pulses would be taken after studying the Sen panel's report.

Commenting on diversion of food grains supplied under public distribution system (PDS), Pawar said the government has received complaints related to diversion mainly from the North-Eastern states. However, he made it clear that it is the responsibility of the state government to check diversion.

On the wide difference between the MSP of wheat and rice, Pawar said: "It is not fully correct that there is vast difference. If you compare with grain, then it (paddy MSP) is slightly more than wheat."

Pawar explained, the government pays MSP and bonus to farmers for procuring paddy, out of which the realisation of rice is only 66-67 per cent.

The MSP plus bonus for paddy stands at Rs 695 and Rs 725 a quintal for kharif 2007-08 marketing season.

Pawar expressed confidence that the government will be able to meet the paddy procurement target of 265 lakh tonnes.

On the rational behind the ban on non-basmati rice export, the minister said the decision was taken to prevent shipment of non-expensive rice which were exported last year at lower rate than the domestic market price.

The government imposed ban on export of non-basmati rice on October 9, which was later partially lifted allowing shipment of those varieties that fetches more than $425 a tonne in the global market.