Hike in edible oil import taxes likely
As the country seeks to be self-reliant by augmenting the domestic oilseed production, India is considering raising import taxes on edible oils. This move could curb the oil purchases and weigh on Malaysian palm oil, along with soy and sunflower oil prices. Simultaneously, it could prop up local prices of oilseeds such as rapeseed, soybean and ground nut.
The world’s biggest vegetable oils importer could the enhance the tax by 5%. Presently, India levies 37.5% and 45% import tax respectively on crude and refined palm oil; while the imports of crude soybean oil, crude sunflower oil and rapeseed oil have a 35% import duty.
The country annually imports around 15 million tonnes of edible oils, including more than 9 million tonnes of palm oil and about 2.5 million tonnes each of soy oil and sunflower oil. While it sources palm oil from Indonesia and Malaysia; soy and sunflower oil is procured from Argentina, Brazil, Ukraine and Russia. India shells around US$10 billion every year on edible oil imports since its reliance on overseas purchases have jumped to 70% from 44% in 2001/02.