Increasing RBD palmolien's tariff value, increases the import duty of this refined oil, lowering its imports. Crude palm oil imports then begin to rise, benefiting Indian refiners losing out at present because their refining capacities are grossly underutilized, said Sushil Goenka, president, The Solvent Extractors’ Association of India.
The government’s weekly Cabinet Committee on Economic Affairs (CCEA) meeting, Monday, failed to give Indian refiners a breather. “The matter was not taken up because the required recommendations were not received from the other ministries,” Goenka said.
India’s refined palmolein imports nearly doubled to 10.85 lakh tonnes in the November-May period of the 2011-12 oil year running November to October, official data said. Local refiners, all medium to large industrial establishments, have a cumulative refining capacity of 12 milllion tonnes, said Goenka. “Excess refining capacity is close to 100 percent,” he said.
India froze the import tariff value on RBD palmolein, at USD482 per tonne, in 2006 in a bid to tame inflation, said Goenka. The import duty was fixed at 7.5 percent. But given today’s market price of RBD palmolien, the import duty on the same works out to some 3.5 percent, necessitating a hike in the tariff value, he said.
Refined, bleached and deoderised (RBD) palmolien is used as a frying oil in the food industry. Tariff value is the base price on which customs duty is decided.
Delays in de-freezing the tariff value will add to refiners’ difficulties, Goenka said.