8/17/04, INDIA(Oilmandi) - Downward revision of import tariff on edibleoil and resolving caratenoid issue for import of crude palm oil can helplower the prices of edible oils, thereby easing the rising inflation rate.Edible oils have high weightage in wholesale price index (WPI).

The Solvent Extractors Association (SEA) of India has made thesesuggestions keeping in mind certain steps being initiated by thegovernment to curb the inflation including considering duty cut on variousitems. Inflation reached at an alarming level of 7.5 per cent for the weekended July, 24, causing serious concerns within the Government as well asthe industry and the trade.

Edible oil carries high weightage in wholesale price index and any changein price of edible oil has direct impact on it and thereby on inflation.

The prevailing tariff value declared by the Government on edible oil ismuch higher than the current international price of edible oil and theeffective total duty is even more higher by 15 - 18 per cent than theprescribed one which can be seen from the accompanying table.

In view of the facts stated above, SEA has suggested to realign the tariffvalue with the market rates. This would have sobering effect on the edibleoil price in the domestic market.

According to SEA, the Government has prescribed the condition of minimumcaratenoid of 500 ppm for crude palm oil to qualify for 65 per cent importduty, else crude palm oil would be charged at a higher duty of 75 percent.