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Following 20% hike backfire, Govt to impose dynamic import duty on oils
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Saturday, 28 September, 2024, 08 : 00 AM [IST]
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Ashwani Maindola, New Delhi
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With the move of increasing import duty by 20% on edible oils backfired, the Union Government is now planning to impose dynamic import duty.
The government increased the import duty on September 14. According to trade analysts, usually when India increases import duty, major edible oil producing countries reduce export duty but this time the export duty was not reduced by the major edible oil producing countries and on the contrary, a big jump was seen in the prices of all edible oils in the international markets.
Therefore, the Indian government's move to increase import duty backfired and the government started looking for new options.
It is learnt that Commission for Agricultural Costs and Prices (CACP) in the Ministry of Agriculture has recommended a "dynamic import duty structure" for agricultural commodities.
The proposed tariff system will be based on the minimum support price (MSP) for oilseeds as well as domestic and global prices.
Shankar Thakkar, president, All India Edible Oil Traders Federation, has reacted, "If the dynamic import duty structure is not studied properly by the Agriculture Ministry and the stakeholders are not included in the committee implementing this dynamic import duty, then this move can also backfire, as it will impact all from consumers to traders, importers and government."
It may also be noted that in India the domestic production of soybean crop may be on higher side this year due to increase in sowing area.
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