05.02.2020 (The Malaysian Reserve) - PAKISTAN Prime Minister (PM) Imran Khan said the country is ready to buy more palm oil from Malaysia after India moved to restrict imports of refined palm oil from the country amid a diplomatic row over Kashmir.
“We noticed India threatened Malaysia for supporting the Kashmiri cause. They threatened to cut their palm oil imports, [therefore] Pakistan will do its best to compensate for that,” Khan said at a joint news conference with PM Tun Dr Mahathir Mohamad in Putrajaya yesterday.
India last month imposed a restriction on refined palm oil imports and effectively ceased all palm oil purchases from Malaysia in response to Dr Mahathir’s criticism on India’s policy towards Kashmir.
Malaysia is the second-largest producer of palm oil and India has been its biggest market for the past five years.
Additionally, the Indian government recently raised import tax on crude palm oil from Asean countries to 44% from 37.5% to boost local oilseed production.
Malaysia exported 18.47 million metric tonnes of palm oil last year, up 12% from the year prior, with 4.4 million tonnes shipped to India alone, data from the Malaysian Palm Oil Board showed.
Pakistan is the third-largest export destination, behind China, with imports of 1.09 million tonnes.
Market observers expect India’s palm oil purchase from Malaysia to hover under 70,000 tonnes in January, according to Reuters, which will be considerably lower than the 253,889 tonnes it imported in January last year.
The figure in February is expected to fall further to less than 10,000 tonnes as Indian buyers shift their palm oil purchase to Indonesia.
New Delhi buys over nine million tonnes of palm oil per year, primarily from Indonesia and Malaysia. Palm oil accounts for about two-thirds of India’s total edible oil imports.
The Malaysian Palm Oil Council (MPOC) in a statement yesterday expected India’s move to roll back on palm oil purchases to be “temporary” and will be resolved amicably between the nations.
“Having long-standing bilateral ties, the two nations will overcome the current challenges, and prevail towards mutual and beneficial outcomes,” the MPOC said, citing Primary Industries Minister Teresa Kok.
It said the implementation of B20 biodiesel this month will also help retain crude palm oil prices.
Khan later thanked Dr Mahathir for speaking up on the ongoing conflict in Kashmir. He had described the situation in the Indian-administered state as an open prison.
“The Indian government has curbed all liberties, imprisoned the leadership and put teenagers in prison. Dr Mahathir has stood with us and has spoken about this injustice that is going on. On behalf of the people of Pakistan, we would like to thank you,” Khan said.