Commodities

Import duty on refined palm oil cut

BL New Delhi Bureau | | Updated on: Dec 21, 2021

The revised Basic Customs Duty will be effective till the end of March 2022

The Centre has slashed the basic customs duty (BCD) on refined palm oil to 12.5 per cent from 17.5 per cent until till March next year and also allowed continuation of import without any quantitative restrictions until December 31, 2022.

The Central Board of Indirect Taxes and Customs (CBIC) on Monday issued the notification, effective from Tuesday, which reduced “BCD on refined palm oil and its fractions from 17.5 per cent to 12.5 per cent till March 31, 2022.” The Directorate General of Foreign Trade also issued a notification on Monday allowing importers to bring in refined palm oil without permit for one more year as the “free” provision was to expire on December 31.

The all-India average retail price of palm oil on Tuesday was ₹129.56 per kg ( against ₹106.22 year-ago), that of mustard oil was ₹187.23 (₹137.96), groundnut oil ₹180.84 (₹158.11) and soyabean oil at ₹150.12 (₹113.10), according to Consumer Affairs Ministry data.

Imports of refined palm oil would increase as duty difference with CPO has come down to only 5.5 per cent now, said BV Mehta, executive director of SEA. The effective duty on CPO is 8.25 per cent.

Strong demand

The government has been reducing import duties on both refined and crude edible oils periodically since June. The total annual domestic demand of edible oils in the country is approximately 25 million tonnes (mt), out of which about 60 per cent is met through imports. Palm oils (crude and refined) import, mainly from Indonesia and Malaysia, constitutes around 60 per cent of the total edible oil import. Share of refined palmolein in import of palm group of oils was 8.2 per cent on 2020-21 oil year.

During 2019-20 oil marketing year (November-October), imports dropped to 13.2 mt valued at about ₹71,600 crore. In 2020-21, India imported a similar quantity but the import bill jumped by 63 per cent and touched an alarming level of ₹1.17-lakh crore due to hike in international prices of edible oils, SEA had said earlier.

Published on December 21, 2021
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