Malaysia Expects Hike in India’s Crude Palm Oil Import with Increase in Refined Oil Duty

Malaysia expects higher demand for crude palm oil from India as the country has increased the import tax on refined palm oil from Malaysia, Bernama reported on September 05.  Mumbai-based Solvent Extractors Association in India said it was grateful to the government “for realizing the grave situation” of the domestic palm oil refining sector.

India, the world’s biggest importer of vegetable oil, said in a government statement that it raised the tax on Malaysian refined palm oil from 45 percent to 50 percent for six months, until March 2, 2020, to curb imports  and boost  local refining.  The country had imposed a 40 percent import tax on crude palm oil (CPO) and 50 percent on refined palm oil.  However, under the Malaysia-India Comprehensive Economic Cooperation Agreement, since January this year shipments of refined palm oil from Malaysia had been taxed at 45 percent.

Malaysian Palm Oil Council Chief Executive Officer Datuk Kalyana Sundram said India had imported substantial quantities of Malaysia’s refined palm oil in the last few months due to the lower tax.  In the first half of 2019, imports jumped 727 percent from the same period a year before.