homemarket Newscommodities NewsExpert talk: Govt cuts palm oil import duty, here’s what it means for India
Expert talk: Govt cuts palm oil import duty, here’s what it means for India
The government on Tuesday reduced basic customs duty on crude palm oil to 10 percent, which will help in bringing down the edible oil prices in the retail market. Prices had made an all-time high in the month of May but since then we have already seen 10-15 percent of the decline in the prices. So, what does the import duty cut really mean for the Indian markets and how are the international markets reacting? CNBC-TV18 spoke to Atul Chaturvedi of Adani Wilmar on the same.
The government on Tuesday reduced basic customs duty on crude palm oil to 10 percent, which will help in bringing down the edible oil prices in the retail market.
Prices had made an all-time high in the month of May but since then we have already seen 10-15 percent of the decline in the prices. So, what does the import duty cut really mean for the Indian markets and how are the international markets reacting?
CNBC-TV18 spoke to Atul Chaturvedi of Adani Wilmar on the same.
Chaturvedi said, “My take is that it is a good decision, but maybe a couple of months too late. In fact, world prices, in any case, are on the downside and prices are collapsing worldwide. Now with this duty reduction in India, I think it is giving a lease of life to the palm producers Malaysia and Indonesia.”
“The worst part is and we keep telling the government whatever you reduce here, actually ends up helping the Malaysian and Indonesian farmers. If you see the numbers today, Malaysia and Indonesia values have gone up by about $50 which means the government of India has actually ended up losing revenues whereas the Indian consumer also might not get the benefit of lower duties.”
He added, “The only thing which I see is that because it is 3 months we could possibly see pretty high imports in the month of July and August - that should result in the sovereign of the Indian local values because whosoever is importing in palm oil has probably ended up importing more than what he requires to ensure that he gets 5 percent reduced duty advantage. So that is the advantage here.”
“Also it brings some kind of certainty as far as the duty regime is concerned. So to that extent, it is a welcome sign," he further said.
Watch the accompanying video for more.
(Edited by : Anshul)
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