India cuts Crude Palm Oil Import Tax
India has cut import tax on crude palm oil from 15 % to 10% for three months. This new duty would be effective from June 30, 2021.
India is world’s biggest importer of vegetable oils. But it has been struggling to bring down edible oils prices. Thus, decision to reduce the import tax was taken. After the tax reduction, palm oil imports will account for 30.25% tax in total. It will include 10% base import duty and other taxes. Overall tax rate on palm oil imports was 35.75% earlier.
How tax cut will help?
Tax cut will make palm oil more attractive than the soy oil and sunflower oil for Indian refiners. It will thus boost imports of tropical oil in next three months and will support benchmark Malaysian prices. Duty cut will provide a necessary respite to consumers from high edible oil prices.
Prices for domestic soy oil and palm oil were doubled in 2020 which hit hard the consumers who were already stung by high fuel prices and reduced incomes because of lockdowns amid COVID-19 pandemic.
Oil import in India
India imports palm oil mainly from Indonesia and Malaysia. India will buy 500,000 tonnes of additional palm oil in these three months. Average monthly imports will be around 850,000 tonnes.
Palm oil is the most widely used and imported oil in India. It is mainly for bulk buyers like food processors and for use in restaurants. Households in India usually prefer soy oil, sunflower oil and rapeseed oil.
Month: Current Affairs - June, 2021
Category: Economy & Banking Current Affairs
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