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Key Points

The Indian government has halved the customs duty on crude palm, soyabean, and sunflower oils, reducing it from 20% to 10%. This change is designed to lower cooking oil prices for consumers, many of whom have felt the pinch of previous price hikes. Additionally, the reduction will benefit the domestic oil processing industry by decreasing raw material costs. The government continues to monitor inflation, taking extra measures such as imposing stock limits on wheat to counter hoarding and speculation.

Key Points: Centre Halves Customs Duty to Lower Cooking Oil Prices

  • Duty on crude oils now 10% from 20%
  • Reduced oil prices to ease household burdens
  • Move supports domestic oil processing industries
2 min read

Cooking oil to turn cheaper as Centre halves customs duty on imports

India's cooking oil costs fall as the Centre cuts customs duty, benefiting consumers and industry.

"The reduction in customs duty aims to ease household budgets and aid domestic processing. - Government Official"

New Delhi, May 31

The government has halved the basic customs duty on crude palm oil, crude soyabean oil and crude sunflower oil from 20 per cent to 10 per cent to bring down prices of cooking oils in the local market and ease the strain on household budgets.

The reduction in customs duty has kicked in with immediate effect as the government wants to lower edible oil prices which had risen by as much as 17.4 per cent in April at time when the retail inflation has been declining.

The move is also expected to benefit domestic oil processing industries as it reduces raw material costs for them.

With the 10 per cent duty cut, the total import duty on the three oils will effectively come down to 16.5 per cent from 27.5 per cent.

In September 2024, the government imposed a 20 per cent basic customs duty on crude and refined vegetable oils. After the revision, crude palm oil, crude soyoil, and crude sunflower oil attracted a 27.5 per cent import duty, compared to 5.5 per cent previously, while 35.75 per cent customs duty is levied on refined grades of the three oils.

India's edible oil imports are estimated to be around 15-16 million tonnes annually. This represents a major chunk of the country’s overall edible oil consumption, estimated to be between 23 and 25 million tonnes.

While India imports palm oil from Indonesia, Malaysia and Thailand, soyoil and sunflower oil are imported from Argentina, Brazil, Russia and Ukraine.

The Centre is keeping a close watch on inflation and on Thursday announced the imposition of stock limits on wheat applicable to wholesale traders and retailers across the country to prevent hoarding and speculation that drives up inflation.

The order imposes a limit of wholesale traders is 3,000 metric tonnes (MT) on the wheat stock that wholesale traders are allowed to keep. For retail traders the stock limit has been fixed at 10 MT, .

For bid chain retailers the stock limit is up to 10 MT for each retail outlet subject to maximum quantity of (10 multiplied by total no. of outlets) MT. This will be the maximum stock that can be held at all their retail outlets and depots put together.

In the case of processors the stock limit for wheat has been fixed at 70 per cent of the monthly installed capacity multiplied by the remaining months of FY 2025-26.

- IANS

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Reader Comments

R
Rajesh K.
Finally some relief for common people! Cooking oil prices were burning holes in our pockets. Hope this translates to actual price drops at kirana stores soon. Govt should also monitor retailers to ensure they pass on the benefit.
P
Priya M.
Good move but temporary solution. Why can't we become self-sufficient in oilseeds? Every year same story - import dependence then price shocks. Farmers need better MSP and tech support for mustard, groundnut cultivation. 🇮🇳
A
Amit S.
As someone from edible oil industry, this will help stabilize prices but quality control is must. Some importers mix inferior grades. FSSAI should increase checks at ports. Also hope refined oil duty gets reduced next.
S
Sunita R.
Inflation is hitting hard - last month my monthly grocery bill went up by ₹1500! This duty cut plus wheat stock limits show govt is serious. But middlemen will still try to cheat common people. Strict action needed!
V
Vikram J.
Smart economic move 👏 Lower oil prices will help control overall inflation. But long term solution is increasing domestic production. Maybe promote coconut oil in South, mustard oil in North to reduce imports.
N
Neha P.
Hope this doesn't hurt Indian farmers. Last time duty was cut, palm oil flooded market and local oilseed prices crashed. Need balanced policy that helps both consumers AND cultivators. Maybe differential duties?

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