A government directive released on Friday states that the reduced import tariff regime on edible oils, such as refined sunflower oil and refined soybean oil, has been extended by the central government until March 25 in an effort to control food inflation.
The Finance Ministry officially announced that the lower tariff, which was originally scheduled to expire in March 2024, will now last until March 2025. Refined sunflower and soy oil previously incurred a basic import tariff of 17.5%; this duty was lowered to 12.5%. Because of the lower landed cost of these oils as a result of the duty decrease, domestic prices will decline.
Food inflation increased to 8.70% in November compared to 6.61% the month before. Nearly half of the total consumer price basket is made up of food inflation, which burdens many households and raises concerns for the government ahead of the general elections in 2024.
India is the world’s largest importer and second-largest consumer of vegetable oil, sourcing 60% of its requirements from outside. Palm oil and its derivatives, which are imported from Indonesia and Malaysia, make up a significant portion of it. Edible oils derived from mustard, palm, soybean, and sunflower are primarily consumed in India.
