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Indian oil producers are requesting an increase in import tariffs on refined oil varieties to protect themselves from the damage caused by growing imports.
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Indian oil producers are requesting an increase in import tariffs on refined oil varieties to protect themselves from the damage caused by growing imports.

Indian oil producers demand an increase in the difference in import tariffs between crude and refined oil to protect domestic processing. The import of refined oils is hurting the industry. It has been proposed to either raise tariffs on refined varieties or lower them on crude oil. This letter was addressed to Minister Pralhad Joshi, and the government's reaction is unknown.

29 April 2025 29 April 2025

The Indian vegetable oil production sphere insists on the need to increase the difference in import tariffs between crude and refined varieties of this product. This step will help limit imports and support our domestic processing industry. This was stated by the Minister of Food Pralhad Joshi at the request of the Solvent Extractors' Association of India (SEA).

SEA noted that oil processing plant owners have invested significant funds in creating oil extraction plants for processing imported crude oil, thus creating jobs. However, the increasing import of refined varieties is causing economic harm to India.

The problem is that suppliers from Indonesia and Malaysia export more refined oils than crude ones. As a result, Indian processing plants are not operating at full capacity. This trend was emphasized by SEA representatives in a letter addressed to Minister Pralhad Joshi.

According to the association, the existing gap in import tariffs between crude and refined palm oil is too small to curb the growing import of processed varieties. In SEA's opinion, the government should either increase tariffs on refined varieties or decrease tariffs on crude palm oil. However, there is currently no information on the authorities' reaction to this industry appeal.

According to the decision introduced in September 2024, the basic customs duty on crude and refined vegetable oils is 20%. As a result of this policy, imported crude oils are subject to a 27.5% tax, while refined varieties face a 35.75% tax.

It was previously reported that in April of the current year, the share of palm oil in India's total vegetable oil imports decreased to 43% compared to the previous year, while the shares of soybean and sunflower oils increased to 57%. Today, India satisfies almost two-thirds of its vegetable oil demand through imports. It mainly sources palm oil from Indonesia, Malaysia, and Thailand, while soybean and sunflower oils are supplied from Argentina, Brazil, Russia, and Ukraine.

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