India may soon see relief from rising edible oil prices. The government is considering reducing import duty on vegetable oils. If approved, the decision could control rising rates before the festive season.
According to a Reuters report, the government is exploring this step. The move aims to reduce inflation pressure on consumers while preparing for higher festival demand.
India imports around two-thirds of its total edible oil requirement. The country remains the world’s largest edible oil importer.
Why Edible Oil Prices Are Under Pressure
India mainly imports palm oil, soybean oil and sunflower oil. These supplies come from Malaysia, Indonesia, Argentina, Russia and Ukraine. Over the last year, vegetable oil prices increased by nearly 20% in India. Meanwhile, the festive period between September and November may increase demand.
During festivals, families prepare more sweets, snacks and fried food items. Therefore, higher consumption could create additional pressure on edible oil prices.
The government is considering import duty reduction to manage this situation. The possible step may provide relief to consumers before celebrations begin.
Government May Reduce Import Duty By 5%
According to the report, government sources said the focus remains on reducing inflation pressure. However, authorities will also consider farmers’ interests. The government may reduce the basic import duty by 5%. This move could help maintain domestic soybean prices above the minimum support level. Additionally, the decision may protect oilseed farmers from possible losses. The government wants to balance consumer needs with agricultural concerns. However, reducing import duty may create another impact. Higher Indian demand could increase global palm oil and soybean oil prices.
An industry official said import duty reduction alone may not become an effective solution. According to the official, price control requires considering wider market conditions.
