24/11/2010 (IIFL) - With 99% of India's annual palm oil requirement being met through imports, the government of India is actively considering to subject more of acreage under oil palm cultivation. This measure is expected to bring down India's palm oil import bill by a significant amount. Agriculture secretary of Indian agriculture ministry, P.K. Basu, chaired a recent meeting on oil palm cultivation on this account. Total annual edible oil imports of India have jumped to over 8 million tons. Of this 80% is palm oil.

In a bid to develop oil palm cultivation in India, the central government had initiated a project Oil Palm Development Program (OPDP) a decade and half back. But the project was not as successful as it was envisioned to be. Under this project, only 1.78 lakh hectares have been covered as against the potential pegged at 10.36 lakh hectares.

The meeting called for reworking the subsidy provided for oil palm cultivation to  Rs. 40,000 per hectare from Rs. 15,500 per hectare, which is the current rate. In the meeting, it was decided to further explore the palm growing potential of non-traditional areas including Arunachal Pradesh, Bihar, Jharkhand, Manipur, Meghalaya, Pondicherry, and eastern Uttar Pradesh.

Steps would be taken to produce a few other states—Assam, Maharashtra, West Bengal, and Tripura—to start taking measures to cultivate oil palm. Earlier, OPDP had identified the potential of growing oil palm in these states. The states will be impressed up on to take to cultivation in the coming fiscal, if not this fiscal. Additionally, to give a special thrust to domestic palm cultivation; in the ensuing five year plan, a mission on oilseeds and oil palm would be launched.

The meeting recommended a policy review pertaining to import of edible oils including the duty structure, since the Open General License applicable in this sector has been making the markets volatile. Enactment of Oil Palm Act by states executing the projects, on the basis of existing legislation in Andhra Pradesh, Tamil Nadu, Goa and Mizoram was also called for. Meeting included representatives from Indian Council of Agriculture Research (ICAR) as well.