Import duty on edible oils: The Government of India has taken a major step to reduce the prices of edible oils in the domestic market. On May 30, the government has reduced the basic import duty on crude edible oils by 10 percent. This decision will be effective from 31 May. India depends on more than 70% of its total vegetable oil demand. India mainly buys palm oils from Indonesia, Malaysia and Thailand. Soybean and sunflower oils are imported from Argentina, Brazil, Russia and Ukraine. When oil prices rise in the international market, it directly affects India’s domestic market and oil becomes expensive. This step has been taken to reduce this inflation and give relief to consumers.
How much will the fee be charged now?
Earlier, the government had reduced the basic customs duty from 20% to 10% on crude palm oil, raw soybean oil and raw sunflower oil. After this new deduction, the total import duty on these three oils will be reduced from 27.5% to 16.5%. This is because they also have India’s agricultural infrastructure and development cess and social welfare surcharge.
What will be its effect?
The government’s move hopes that edible oil prices will be lower. Due to decrease in import duty, oil coming from abroad will become cheaper, which will directly benefit Indian consumers. Demand for edible oils will increase due to low prices. Foreign purchase of palm oil, soybean oil and sunflower oil will also increase to meet domestic demand.
When were the fees changes before?
In September 2024, India imposed a basic customs of 20% on raw and sophisticated vegetable oils. After that amendment, crude palm oil, crude soybean oil and raw sunflower oil used to impose 27.5% import duty, while before that it was 5.5%. At the same time, the refined grade of these three oils now levies 35.75% import duty. This new decision is part of the government’s efforts to control the rising prices of edible oils and provide relief to the general public.
