Our Bureau
New Delhi
The Centre has cut basic customs duty (BCD) on crude and refined edible oils, including palm, soybean and sunflower oil, in a move aimed at lowering import costs and easing pressure on domestic cooking oil prices ahead of the festive season.
Under the revised structure, the BCD on crude soybean and crude palm oil has been reduced to 5% from 10%, while the duty on their refined variants has been lowered to 27.5% from 32.5%. The sharpest reduction has been made for sunflower oil, with the duty on crude imports brought down to nil from 10% and that on refined sunflower oil cut to 22.5% from 32.5%. The changes came into effect on September 24.
The government expects the lower duties to reduce the landed cost of imported edible oils and eventually provide relief to consumers. However, the extent of any fall in retail prices will depend on factors including international oil prices, freight costs, exchange-rate movements and domestic supply conditions.
The move comes as edible oil prices have risen significantly over the past year. As of September 23, soybean oil retailed at ₹167 per kg, up 14% from a year earlier. Sunflower oil was priced at ₹194 per kg, an increase of 19.5%, while palm oil rose 16.3% to ₹154 per kg.
The government has also retained a duty differential between crude and refined oils to encourage domestic refining and discourage excessive imports of refined products.
India depends substantially on imports to meet its edible oil requirements, making domestic prices sensitive to global commodity markets. With the festive season approaching, the move is expected to curb import costs resulting in reduced retail prices for consumers.