9/15/04 INDIA (Oilmandi) - A CUT in the tariff value or base price onwhich import duty is levied on edible oils is now almost certain.
"Tariff values will be adjusted and new prices would be announcedtomorrow," the Finance Minister, Mr P. Chidambaram, said after a meetingwith the Prime Minister, Dr Manmohan Singh, and the Commerce and IndustryMinister, Mr Kamal Nath, here today.
Currently, the tariff values have been fixed at $504 per tonne for crudepalm oil (CPO), $532 per tonne for crude palmolein, $543 per tonne forrefined palm oil, $552 per tonne for refined palmolein and $628 per tonnefor crude soyabean oil. While the base price for crude soya oil was lastrevised on May 31, those on other oils have remained unchanged ever sinceNovember 14, 2003.
The tariff values were fixed originally in order to curb under-invoicingby importers, as it was being seen that the invoice prices were way belowthe ruling international prices. The importers were resorting to thispractice, in order to minimise their incidence of duty liability.
But since the beginning of the current year, international prices havefirmed up considerably, leading to a situation where the tariff values arenow way above the actual landed prices. The c.i.f. (cost, insurance,freight) price of crude soya oil is now about $ 556 per tonne, while thecorresponding levels would work out to around $430 per tonne for CPO, $465per tonne for refined palm oil and $475 per tonne for refined palmolein.
While Mr Chidambaram refused to comment on the proposed magnitude ofrevision in tariff values, the figure doing the rounds is of a roughly 10per cent reduction from the existing levels.