05/08/2011 (Economic Times) - The Karnataka government is working on modalities to provide assured returns to palm oil cultivators. India is the world's largest buyer of palm oil, which accounts for more than 80% of its edible oil imports.

"We are in discussion with companies which are promoting oil palm cultivation. As the Centre had earlier rejected to fund the project partially, we are now looking at providing subsidy or some other intervention," said Karnataka horticulture director Poovel Hemalata. She added that the proposal would be finalised before farmers take up new plantations. Across 18 districts of the state, oil palm is cultivated on over 10,000 hectare. The state is looking to expand cultivation by 5,000 hectare along the coast this year.

The industrial houses which are working with farmers include Godrej Oil Palm, Ruchi Soya, Food Fats and Fertilizer, Bhadravati Balaji Oil Palm and Simha Puri Agrotech. The companies are citing the Goa government's move to fix the support price of 7,000 per tonne for oil palm fresh fruit bunch (FFB). According to the state-sponsored support price scheme, any difference between the price fixed by the Project Management Committee and 7,000 would be made good by the Goa government.