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Edible oil trade body Solvent Extractors’ Association of India (SEA) has raised its demand to impose safeguard measures on palm oil imports from countries enjoying Most Favoured Nation (MFN) status with India.
In a letter to the trade and industry, SEA President Atul Chaturvedi stated that the industry would like the Government of India “to invoke the Article 5 of Chapter 5 of Comprehensive Economic Cooperation Agreement With Malaysia (CECAM) under which India can take safeguard measures in case serious injury is caused to domestic industry and can suspend duty reduction or levy the duty applicable to MFN.”
The move is aimed at protecting the palm oil refining industry in India.
The trade body has been representing to the government for the past few months that the duty advantage given to Malaysia for Palmolein may potentially destroy India’s palm refining Industry but the effort has yielded nothing so far. “As anticipated, our worst fears have come true. Our nation is flooded with RBD Palmolein from Malaysia following reduction of duty difference from 10 per cent to 5 per cent between CPO and Palmolein sourced from Malaysia,” said Chaturvedi in the letter sent on Monday.
Import of RBD Palmolein has gone up from 130,000 tonnes in December 2018 to almost 312,000 tonnes in March 2019 and the same is expected to increase further in coming months.
Palmolein imports have a significant negative impact on the returns of mustard farmers with harvesting almost complete.
“This anomaly needs to be corrected at the earliest. There is an urgent need to create duty difference of 10 per cent between CPO and RBD Palmolein, irrespective of the origin, as was prevailing before 1st January 2019,” Chaturvedi stated in the letter.
On the mustard seed crop and its weak prices, Chaturvedi welcomed the government move to start procurement of mustard through Nafed to the extent of 20 lakh tonnes at the MSP of ₹4,200 per quintal.
But it suggested that “Nafed should procure mustard seed from all leading mandis to defend MSP. Further, to ensure NAFED does not end up losing big money, import duties on Edible Oils should be kept high to ensure market forces keep prices of oilseeds well supported.,” he added.
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