Indian Vegetable Oil Producers’ Association (IVPA) has said that the government’s move to reduce customs duty in crude palm oil (CPO) would provide some relief to the consumers.
The government announced the reduction of effective import duty from 35.75 per cent to 30.25 per cent on Tuesday. In a statement on late Tuesday evening, Sudhakar Desai, President of IVPA, said that IVPA appreciates the new practice of transparency and stability as the duration of the duty has been prescribed up to September 30.
“This is probably done keeping in mind the kharif harvest arrivals of oilseeds. This is a very positive move as it will reduce the unnecessary duty speculations. IVPA in its representation has also been seeking a similar transparent mechanism of import policy,” he said.
Palm oil is mainly used in HoReCa (hotels, restaurants, catering), bakery and institution segments which are otherwise affected during the pandemic. This move provides a requisite necessary respite and relief from the burden of high edible oil inflation for the last one year, he said.
The demand for palm, and in general for oils, should increase. He said the downstream sales were down by about 30 per cent for the last one month due to the duty rumours and the lockdowns compared to normal sales. Indonesia has also reduced the export duties by about 15 per cent which would also help achieve lower edible oil prices, he said.
Desai said IVPA has also requested the government to evaluate a dynamic slab duty structure which will provide stable and equitable policy and will be a further step in the right direction of a balanced growth model.
IVPA also made representations to restrict zero duty soybean refined oil imports from neighbouring countries or canalise the same through government agencies to provide a level playing field for the Indian industry, he added.