The Hindu Business Line : Vanaspati sector opposes move to hike vegoil import duty

The debate within the country’s oils and fats industry over the desirability of continuing with a zero-duty regime for imported crude oils is heating up with a memorandum from the two New Delhi-based industry associations representing vanaspati (hydrogenated oil) to the Union Food and Agriculture Minister as also the Finance Minister urging not to make any change in the present duty structure.

Modest fall

The associations have pointed out that although international prices of oils such as palm oil and soyabean oil have fallen considerably (35 to 56 per cent) in recent months, domestic prices of major indigenous oils such as groundnut oil, mustard, oil, soyabean oil and sunflower oil have shown only modest declines (5.7 to 9.6 per cent).

Above MSP

Oilseed growers are not hurt because open market prices continue to rule above the minimum support price fixed by the Government, the industry bodies remarked.

Effect on foods sector

The vanaspati industry has argued that any hike in duty will hurt interests of poor consumers and processed foods industry that uses palm-based shortening and margarine.

Industry’s fear

The domestic vanaspati industry has barely managed to stay afloat after facing tough competition from liquid oils and imports from neighbouring countries.

There is apprehension that a duty hike on raw material will push the industry back to the brink of sickness.

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