The Solvent Extractors’ Association of India (SEA) has said that the influx of cheaper refined edible oil from Nepal is affecting domestic oil refining industry in India.
In his monthly letter to the members on Thursday, Sanjeev Asthana, SEA President, said edible oils are allowed to be imported from SAFTA (South Asian Free Trade Area) countries at zero duty under the SAFTA agreement.
However, the recent duty hike on edible oils in September 2024, combined with the zero duty under SAFTA, has led to an influx of cheaper refined oil from Nepal. He said this is particularly affecting the domestic oil refining industry, not only in Northern and Eastern India but now also in Central India, including Madhya Pradesh and Rajasthan.
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“We urge the government to find a balanced solution that honours SAFTA commitments while protecting domestic farmers and refiners,” he said.
Commending the Union Agriculture Ministry for conducting a survey on edible oils via the MyGov platform, Asthana said this initiative aims to understand consumer preferences and will guide farmers to cultivate demand-driven crops. By aligning production with consumption patterns, this survey will help move the country towards self-sufficiency in edible oils. Questions in the survey cover aspects such as monthly oil consumption, preferences for types of oil, and seasonal oil usage. Once made public, the results will be invaluable for the industry and trade in deciding which oils to produce or import, he said.
Stating that SEA has submitted a memorandum to NITI Aayog requesting a revision in the weightage of individual edible oils in the Wholesale Price Index (WPI), he said the Government has established a Working Group under NITI Aayog, headed by Ramesh Chand, to revise the WPI, moving from the 2011-12 base to 2022-23.
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Currently, edible oils account for only 2.64293 per cent of the WPI, based on 2011-12 consumption and average prices.
Mentioning that consumption patterns have shifted significantly, he said the proportion of vanaspati in total edible oil consumption has decreased from 5.75 per cent in 2010-11 to 2.92 per cent in 2023-24, while soyabean oil’s share has grown from 15.55 per cent to 19.28 per cent over the same period.
The association has submitted a memorandum to NITI Aayog, requesting a revision in the weightage of individual oils in the WPI to reflect these changes. “We are pleased that Prof Ramesh Chand has assured us that our proposal will be considered by the Working Group,” he said.
