New Delhi (TIP): The Centre has reduced import duties on crude and refined edible oils, including palm, soybean and sunflower oil, in an attempt to ease pressure on consumers as cooking oil prices rise and demand gathers pace ahead of the festive season.
The revised customs duty structure came into effect on September 24. Under the new rates, the Basic Customs Duty (BCD) on crude sunflower oil has been reduced from 10% to nil, while the duty on crude soybean oil and crude palm oil has been cut from 10% to 5%.
The government has also lowered duties on refined varieties. The BCD on refined sunflower oil has been reduced from 32.5% to 22.5%, while that on refined soybean and palm oils has been brought down from 32.5% to 27.5%.
The government said the move is aimed at moderating domestic edible oil prices and containing inflationary pressure arising from higher international prices. It has retained a 19.25% differential between crude and refined edible oils, a structure intended to support domestic refining capacity and discourage excessive imports of refined oil.
The duty reduction comes at a crucial time for consumers, with edible oil prices having risen amid higher global commodity prices. India relies heavily on imports to meet its edible oil requirement, leaving domestic prices sensitive to movements in international palm, soybean and sunflower oil prices.
The government has also sought to ensure that the reduction in import costs translates into lower prices for consumers. The Food Ministry has asked edible oil companies and industry bodies to pass on the benefit of the duty cuts through the supply chain and revise distributor prices and retail prices wherever warranted.
The move is expected to be particularly relevant during the upcoming festive period, when consumption of cooking oil typically increases. Demand rises not only from households but also from sweet manufacturers, restaurants, hotels and catering businesses.
Industry representatives have said lower duties should reduce the landed cost of imported edible oils and could provide some relief in the retail market. However, the extent and speed of any price reduction will depend on international edible oil prices, freight costs, currency movements and inventories held by importers and refiners. The latest decision follows the Centre’s earlier reduction in duties on crude edible oils in June 2025, when the BCD on crude palm, soybean and sunflower oils was lowered from 20% to 10%.
With food prices remaining a key concern for households, the latest duty cut is intended to provide near-term relief while maintaining a policy differential that supports domestic edible oil refining.
Be the first to comment