New Delhi, Mar 20 (UNI) To cushion the domestic consumer against the impact of hardening international food prices, the government today reduced the import duty on edible oils, further extended exemption of duty on milled rice and froze tariff values of crude palm oil.
The government reduced import duty on semi-milled or wholly milled rice from 70 per cent to nil. This exemption would be available only upto March 31, 2009.
The duty on crude palm oil, including crude palmolein has been brought down from 45 per cent to 20 per cent.
In the same vein, refined palm oil including RBD palmolein has been slashed from 52.5 per cent to 27.5 per cent per cent.
Duty on crude Mustard/rapeseed/colza/canola oils has been brought down from 75 per cent to 20 per cent.
In the case of refined Mustard/rapeseed/colza/canola oils duty has been dropped to 27.5 per cent from 75 per cent.
Duty on crude sunflower oil has been reduced from 40 per cent to 20 per cent and refined sunflower oil from 50 per cent to 27.5 per cent.
Besides, the tariff values of crude palm oil (447 dollars per metric tonne), RBD Palm oil (476 dollars PMT), crude palmolein (481 dollars PMT), and RBD Palmolein (484 dollars PMT) have been frozen at July, 2006 prices.
An official release said the government has been keeping a close watch on the domestic and international prices of essential commodities, particularly food items such as wheat, rice, pulses, and edible oils so as to keep inflation under check.
It has also taken appropriate fiscal measures from time to time to achieve this objective.
Full exemption from customs duty available to wheat has been extended beyond the expiry date of December 31, 2007 and wheat flour has also been fully exempted from customs duty.
Over the last six months, the international price of rice has increased sharply from 430 dollars (August 2007) to 590 dollars (February 2008) (FAS US Gulf).
Domestic retail price in Delhi markets increased from Rs 15 to Rs 18 per kg over the same period.
Owing to a surge in demand, international prices of edible oils have also continued to exhibit a sharp and steady upward trend in recent months.
For instance, the international price of crude palm oil (for Malaysia) has increased from 770 dollars PMT in the last week of August, 2007 to about 1,220 dollars PMT in the last week of February, 2008.
During the same period, the international price of sunflower oil (cif Rotterdam) has increased from 947 dollars to 1,695 dollars PMT - an increase of about 79 per cent.
The release said an increase of this order has obviously put pressure on domestic prices of edible oils despite two rounds of reductions in customs duties on palm oil in April, 2007 (by 10 percentage points) and again in July, 2007 (by five percentage points).
Wholesale prices of RBD palmolein (Mumbai) have increased from Rs 4,500 per quintal in August 2007 to Rs 5,820 per quintal in February, 2008.
Over the same period, price of sunflower oil (Mumbai) has increased from Rs 4,900 per quintal to Rs 8,250 per quintal and of mustard oil (Delhi) from Rs 4,960 per quintal to Rs 6,330 per quintal.
UNI GS SR RN2127