The Government has approved a proposal to defreeze the import tariff value on refined palm oil from the existing $484 per tonne and link it to current global prices.
“The Cabinet Committee on Economic Affairs has approved the proposal of the Ministry of Consumer Affairs, Food and Public Distribution to defreeze the tariff value on imported RBD palmolein from $484 per tonne and align it with the current international prices,” an official release said today.
Unshackling of the import tariff value is aimed at curbing higher import of refined cooking oil and protect the domestic industry.
Tariff value is the base price on which Customs duty is determined and is aimed to check under-invoicing by importers. It is fixed every fortnight on the basis of global prices.
However, since July 2006, the Government did not tweak with the tariff value on refined palmolein at $484 per tonne against the current global price of $1,000.
Lower tariff value on imported refined palmolein has boosted shipments in the last few years.
That apart, Indonesia has lowered the export duty on refined palm oil from 15 per cent to 8 per cent, affecting domestic edible oil processors. Indonesia is the largest exporter of crude palm oil to India.
Between November 2011 and April 2012, about 9.19 lakh tonnes of RBD refined palmolein was imported against 4.87 lakh tonnes during the corresponding period in the previous year, recording an increase of 88.7 per cent.
In comparison, imports of CPO increased 14.8 per cent from 21.72 lakh tonnes to 24.93 tonnes during the same period.
India imports more than half of its domestic requirement. While palm oil is being imported from Indonesia and Malaysia, soyabean oil comes from Argentina and Brazil.
India imported about 8.37 million tonne of cooking oils in 2010-11 marketing year, out of which palm oil contributed more than 50 per cent.