The Solvent Extractors’ Association (SEA) of India has written to the Centre urging it to channelise the import of edible oil from Nepal through a public sector undertaking (PSU).
In a representation to the Government, dated May 28, SEA of India had alleged massive influx of soyabean oil from Nepal to India flouting rules of origins. SEA had then stated that the import was seriously hurting domestic refiners, farmers and was leading loss of revenue to the Government.
20% value-addition
In a letter to the Union Commerce Minister, Piyush Goyal, dated June 4, the President of SEA of India, Atul Chaturvedi, said the Nepal Ministry of Industry and Supplies as well as Nepalese Chambers of Commerce and Industry have issued press release stating that certificate of origin issued for export of refined soybean oil to India is meeting the value addition of 20 per cent norms under Indo-Nepal treaty.
“Without getting into a discussion on the merit or demerits of Nepalese claims pertaining to value addition and rules of origin norms, we would like to suggest a win-win situation for all,” the letter said, suggesting that the import from Nepal be channelised through a PSU like NAFED for distributing the edible oil to the vulnerable sections of society through public distribution system (PDS). It said that India is bound by SAFTA agreement to allow import from Nepal at zero duty.
The letter noted that the Government would be able to get zero duty oil from Nepal, without lowering overall import duty for the country, in a much more regulated manner. This can provide solace to the underprivileged.
It said that the prices of edible oils have skyrocketed in the world and poor consumers in India are suffering. Reducing import duty may not help much as it gets negated by increase in values internationally. This move may also not be construed as 'farmer friendly’ with Kharif oilseed planting round the corner.
Import through a PSU would also help the Indian refining industry in Eastern and Northern India, which is facing the brunt of zero duty imports flooding these markets from Nepal, he said.
To check excessive import, SEA also suggested the Government to fix the quota for import of refined oils from Nepal, and distribute them month-wise / region-wise. This will have minimum impact on domestic refinery industry, he said in the letter.