Solvent Extractors' Association Pushes For Hike In Import Duty On All Soft Oils

Expressing concerns on the country’s mounting dependence on imported edible oils, the Solvent Extractors’ Association of India (SEA) has requested the government to hike the import duty on other edible oils – soft oils – in line with palm oil duty structure.

Recently, the government had increased import duty on crude palm oil to 44 per cent from 30 per cent starting March 1, 2018. Import duty on refined bleached deodorised (RBD) palmolein was also hiked to 54 per cent from the earlier 40 per cent. Although, the trade body has welcomed the move, it also flagged the looming crisis for other edible oils, which will witness increased imports as a result of discouraged imports of palm oils.

“We welcome increase in duties for palm oils, but we are surprised at singling out palm oil only for the increase in duties. The current duty hike only for palm oil will rather encourage the import of other oils like rapeseed oil, sunflower oil and soyabean oil, which will be detrimental to the interest of the domestic farmers,” said Mr. Atul Chaturvedi, President, SEA, in a recent representation made to the Finance Minister Mr. Arun Jaitley.

Boosting oilseed farming

Mr. Chaturvedi termed the singling out of palm oil for duty hike ‘unfair’ and defeating the objective of doubling farmers’ income by allowing value increase for domestic oils.

In his request to the government, he raised the concerns of keeping farmers interested for oilseed cultivation amid challenges posed by the mounting imports.

“Needless to mention, it would be difficult to encourage oilseeds farmers to grow more oilseed and augment their income if duties on these oils are not raised,” he wrote in the letter. “Our dependence on edible oils has reached alarming levels of almost 70 per cent of our consumption. We are sure and confident, hike in duty will boost the acreage and production of oilseeds in the ensuing kharif season,” he added.

Indonesia to hold talks

Meanwhile, Indonesia prefers bilateral talks over retaliation, the latter’s Trade Minister Enggartiasto Lukita said. “The Indian Commerce and Industry Minister has asked me for a letter on the issue so that it would be discussed by the cabinet,” he informed.

India is Indonesia’s biggest palm oil export market. According to the Indonesian Palm Oil Association or GAPKI, Indonesia exported 7.6 million tonnes (mt) of palm oil to the country in 2017, up from 5.8-mt in 2016.