NEW DELHI, Sept 20 Asia Pulse - The edible oil industry has demanded animmediate cut in the base price on which import duty is levied on edibleoils to curb inflation which is at a four-year high of 8.33 per cent.
The prevailing base price on which import duty is levied (Tariff Value) onpalm and soya oils is US $68-106 a tonne higher than the internationalprice at which these commodities are imported, Executive Director, SolventExtractors Association B V Mehta said.
In a letter to Finance Minister P Chidambaram, the association said thetariff value must be aligned with the market rates to have a soberingeffect on the edible oil prices in the retail and wholesale sector.
Inflation has reached an alarming 8.33 per cent, highest in four years,which is a cause of serious concern to the government as well as theindustry and trade, it said.
It pointed out that edible oil carries high weightage in wholesale priceindex and any change in price of edible oil has a direct impact oninflation.
It also demanded that the prescribed condition of minimum caratenoid of500 parts per million (ppm) for crude palm oil (CPO) to qualify for 65 percent import duty should be relaxed as it was nearly impossible to meetthis specification.
Hence, most of the CPO is imported at a higher import duty of 75 per cent,thus increasing costs and contributing to inflation, it added.
The effective duty levied on palm and soya oils is around 17-18 per centhigher than the acutal duty due to artificially high tariff value.