Kitchen budget may deteriorate, government may increase import duty on vegetable oils
Oil Price: The government is considering increasing import duty on vegetable oils. The government may take this step in the coming weeks to help farmers troubled by low prices of oilseeds. In July, India's vegetable oil imports increased by 22.2 tonnes to 19 lakh tonnes. India meets more than 70 percent of its vegetable oil demand through imports.
The government is considering increasing import duty on vegetable oils. The government may take this step in the coming weeks to help farmers troubled by low prices of oilseeds. If the government does this, foreign purchases of palm oil, soy oil, and sunflower oil may decrease.
An official, on condition of anonymity, said that we are exploring all options to help farmers. Increasing import tax is also included in it. In July, India's vegetable oil imports increased by 22.2 tonnes to 19 lakh tonnes. This is the second-highest import ever. India meets more than 70 percent of its vegetable oil demand through imports.
It primarily purchases palm oil from Indonesia, Malaysia, and Thailand, and imports soybean oil and sunflower oil from Argentina, Brazil, Russia, and Ukraine. The Ministry of Agriculture has submitted a proposal in this regard, and the Revenue Department under the Ministry of Finance will make the final decision. When asked for a response in this regard, a department official declined to comment.
To reduce prices, India, the world's largest vegetable oil importer, will abolish the basic import duty on crude vegetable oils in 2022. The government, however, continues to charge a 5.5% fee as an agricultural infrastructure and development cess. Domestic soybean prices are currently around Rs 4,200 per quintal, which is less than the prescribed support price of Rs 4,892.
Farmers of Maharashtra are unhappy with the fall in soybean prices. Mes Gaikwad, a farmer who grows soybeans on four acres (1.62 hectares), said that at the current price, we are not even able to recover our production cost.
The special thing is that assembly elections are going to be held in Maharashtra within the next three to four months and the soybean-producing farmers here are an influential voter group. BV Mehta, Executive Director of the Solvent Extractors Association of India, said that the new crop of soybean will arrive in six weeks, which will further reduce the prices.
