As per India Import Data Indonesia and Malaysia are the major suppliers of Crude palm oil to India. During November 2020 and August 2021, Malaysia was the leading supplier of crude palm oil (3,015,246), followed by Indonesia (2,723,267 tons)

According to India Export Data the imports of palm oil in India jumped in the month of August by more than 61% on the month to 750,134 mt according to data published by national trade body, as bulk buyers looked to pad up edible oil inventories ahead of India’s upcoming festival season.

Lower duties in India and Indonesia, along with tighter domestic stocks ahead of festive season have contributed to sharp increase in imports. Furthermore, due to relaxation of policy for imports by the Government of India deliveries of refined palm oil into India has increased by many folds in the month of August and are likely to continue to see similar volumes in coming months.

India is the largest buyer of vegetable oils in the world and imports about 15 million mt of vegetable oils annually of which palm oil accounts for 8 million to 9 million mt. The Indian government has reduced import duty on crude palm oil to 30.25% from 35.75% set earlier with effect from 1st July till end of September.

Import duty on refined palm oil is reduced to 41.25% from 49.5% earlier, while the same on soy oil is kept unchanged at 38.50% as per India Import Data. Lower import duty by India has in fact encouraged both Malaysia and Indonesia to impose higher export taxes on palm products since November. If Malaysia increases base export price of palm products again then it will again bring back things from where it all started for Indian customers.

By reducing custom duty on crude palm oil, the Indian government has tried to balance the interest of both consumers and farmers. It will give immediate relief to the poor on one hand and on the other the farmers will be protected as duty will again be increased from October when harvesting season begins.

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