Agriculture Ministry proposes hike in import duty on edible oil

NEW DELHI: The Agriculture Ministry has moved a Cabinet proposal to hike import duty on edible oil to protect the interest of domestic farmers and processors, Food Minister Ram VilasPaswan today said.

While the Agriculture Ministry has proposed increase in import duty of refined edible oil to 12.5 per cent from the existing 10 per cent, the Food Ministry has recommended that the hike should be to 15 per cent.

On crude edible oil, both the ministries have proposed that import duty should be increased to 5 per cent from the current 2.5 per cent.

"The Agriculture Ministry has moved a Cabinet proposal to increase the duties on import of edible oils," Paswan told reporters here.

He said the food ministry has recommended import duty of crude edible oil at 5 per cent and refined 15 per cent.

Sources said the food ministry favours maintaining a duty differential between crude and refined edible oils at 10 percentage points, while the agriculture ministry wants it to be at 7.5 percentage points.

In October, Paswan had met Finance Minister Arun Jaitley to discuss the issue of raising import duty on crude and refined edible oils to restrict cheap imports.

India's vegetable oil imports rose 12 per cent to all time high of 11.82 million tonnes in the 2013-14 marketing year ended October, on rise in domestic consumption and low rates of cooking oils.

The country imports about 60 per cent of the annual domestic demand of vegetable oils (comprising edible and non-edible oils) of about 19 million tonnes.

Industry body Solvent Extractors' Association has been demanding to increase the import duty on edible oils to protect the domestic oilseeds processors.