15/07/2009 (Bloomberg) — India, the world’s largest buyer of vegetable oils after China, has no plans to increase duties on imports of palm oil to ensure supplies at affordable rates, Commerce Minister Anand Sharma said.

Overseas purchases of crude palm oil will continue to be duty-free and the import tax on refined, bleached and deodorized palmolein will stay at 7.5 percent, the minister said in a written reply in the Rajya Sabha, the upper house of Parliament.

“In order to keep domestic edible oil prices at affordable and within the reach of the common man, at present there is no proposal to increase import duty on palmolein and palm oil,â€Â Sharma said.

Maintaining the import tax may help support this year’s 24 percent gain in crude palm oil prices in Malaysia, the second- biggest producer of the commodity. Palm oil makes up almost 90 percent of India’s total edible oil purchases.

India abolished import duty on crude palm oil in April last year, and in March lifted a 20 percent tax on crude soybean oil purchases. The two commodities are substitutes. Refined edible oils are taxed at 7.5 percent.

The nation’s vegetable oil imports surged 79 percent to 5.82 million tons in the November-June period, Mumbai-based Solvent Extractors’ Association of India said yesterday. Crude palm oil imports in the eight months to June jumped 66 percent to 3.49 million tons, while soybean oil purchases gained 86 percent to 660,504 tons, it said.

India, which relies on overseas purchases to meet almost half its cooking oil demand, buys palm oil from Malaysia and Indonesia, and soybean oils from Argentina and Brazil.