More Stories

Informist, Monday, Feb. 10, 2025

MUMBAI – The increase of refined soybean oil and palm oil imports from Nepal under the South Asian Free Trade Area agreement is hurting domestic refiners and farmers and causing a revenue loss to the government, the Solvent Extractors' Association of India said Monday. In a letter, the association urged the government to find a balanced solution that honours free trade commitments while protecting the domestic edible oil sector.

The duty increase on domestic edible oils in September, combined with the duty-free imports, has led to an increase in inflow of cheaper refined oil from Nepal. While the import of cheaper oil from Nepal was affecting the domestic refining industries in northern and eastern India, it has begun affecting south and central India as well, the association said. 

From Oct. 15 to Jan. 15, Nepal imported 194,974 tonnes of crude edible oil from India and exported 107,425 tonnes of refined edible oil to India. "In view of duty advantage under SAFTA agreement, as per market source, estimating at least 50,000-60,000 tonnes of refined oil per month will flow from Nepal to India hurting domestic refining industry and farmers," the association said.

Under the free trade agreement, edible oil is allowed to be imported from member countries at zero duty. The members of the free trade regime are Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka. "... many countries are using the SAFTA agreement to dump their products duty-free into India with the help of traders in the SAFTA region. This is abuse and misuse of SAFTA," the association said.

Among other recommendations, the association has requested the government to impose a minimum import price on edible oils from members of the free trade regime. The minimum import price should not be less than the price of oil extracted from oilseeds in India as per the minimum support price for oilseeds, it said in a release. It also recommended fixing a quota for imports of refined edible oil from Nepal.  End

Reported by Shreya Shetty

Edited by Rajeev Pai

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.