21/12/2008 (The Hindu), New Delhi - The government will consider imposing duty on crude palm oil imports as suggested by the industry, Commerce and Industry Minister Kamal Nath has said.

"They have represented for raising duty on palm oil. There is a steep fall in international prices. They want protection of the Indian oilseed industry and imposition of duty," Nath has said after meeting representatives of the edible oil industry.

On being asked if he held a positive view on the imposition of duty, Nath said, "We will look into it. If factually the position is correct, protection of Indian industry has to get the first priority."

Indore-based Soyabean Processors Association has demanded that a 20 per cent import duty be imposed on crude palm oil, which accounts for about 85 per cent of the country's total edible oil imports.

Sources said the minister enquired about the possible impact of the duty hike on retail prices of cooking oil. Industry representatives told Nath that the prices will increase by Rs 3-4 per litre.

As part of the measures to control inflation, the government had, in April, scrapped import duty on crude edible oils. However, the Centre had recently imposed a 20 per cent import duty on crude soya oil while leaving the duty structure of other edible oils unchanged.

Moreover, with the prices in the global markets crashing up to 400 dollars a tonne from 1,400 dollars in March raising the scope of imports in view of the firm prices in the country, the domestic industry has asked for levying import duty.

India's edible oil consumption stands at 12.5 million tonnes while it produces just around 7.5 million tonnes. It depends heavily on imports, especially from Malaysia and Indonesia, to meet its domestic demand.