In a bid to provide relief to consumers, the Government has reduced the Basic Customs Duty (BCD) on major imported crude edible oils to help moderate domestic edible oil prices. The move is aimed at mitigating inflationary pressures arising from the sharp increase in international edible oil prices.
The BCD on Crude Sunflower Oil has been reduced from 10% to Nil, while the BCD on Crude Soybean Oil and Crude Palm Oil has been reduced from 10% to 5%, according to a press release issued by the Ministry of Consumer Affairs, Food & Public Distribution. The Government has also reduced the applicable BCD on the respective refined edible oils, while maintaining an import duty differential of 19.25% between crude and refined edible oils.
The reduction in BCD on crude edible oils is expected to lower their landed cost and facilitate transmission of the benefit through the domestic supply chain. At the same time, the Government has maintained the duty differential between crude and refined edible oils to support the utilisation of domestic refining capacity and discourage excessive imports of refined edible oils. The measure is expected to provide a more level playing field for domestic refiners while supporting continued value addition within the country.
The Government has also requested industry stakeholders to immediately revise their Price to Distributors (PTD) and Maximum Retail Price (MRP) in accordance with the reduction in landed costs. Edible oil associations have been requested to advise their members to implement the corresponding price reductions without delay, so that the full benefit arising from the reduction in import duty is passed on to consumers.
-with PIB inputs
