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News Admin
 
Date
 19/03/2008
News Provider
 Kamar Nor Aini Bt Kamarul Zaman
News Source
 Business Standard
Headline
 Govt bans export of edible oil for one year

18/03/2008 (Business Standard) - The government has banned export of edible oil for one year to check rising domestic prices and control inflation. The ban will be in place till March 16, 2009.


The government had banned export of sugar, wheat, pulses and skimmed milk powder in an effort to control inflation. It has also regulated exports of rice and onion.


Edible oil has a weightage of 2.76% in the wholesale price index (WPI) -  higher than cement (1.73%), wheat (1.38%) and rice (2.45%).


"The ban will not have a major impact on edible oil as exports constitute a small per cent of the entire trade. There was no point in banning export of groundnut oil, which is a premium oil and where the realisation is significantly high. The industry could have substituted such export by importing higher quantities of soya oil or palm oil from the export earnings," said Davish Jain, chairman, Central Organisation for Oil Industry and Trade.


India exported 11,639 tonne edible oil in 2006-07. India primarily exports small quantities of groundnut oil, mustard oil and coconut oil.


In a notification dated March 17, the Directorate General of Foreign Trade said the ban will also cover deals under the transitional arrangements. This implies exporters who had received letters of credit for export on or before March 17 (when the ban came into effect) will not be allowed to honour their commitments.


The country meets about 45% of its edible oil requirement through imports. The second advance estimates released by the agriculture ministry last month puts this year's rabi oilseed production at 9.59 million tonne - down 6.7% from last year.




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