July 2: India has removed restriction on import of palm oil almost a year after imposing a ban.  Nepali entrepreneurs that the latest decision of India opened the door for export of refined palm oil from Nepal.

The Directorate General of Foreign Trade of India said in a statement on Tuesday that the import of palm oil has been resumed. India has allowed the import till the end of December. The government of India has given permission to Nepal and other countries to export palm oil after the rise in the price of edible oil in India.

Even though India has started importing palm oil, it will take at least one month for Nepali entrepreneurs to export the oil to India, opined Suresh Rungta, operator of OBC Food.

“After the suspension of exports to India, industrialists are now focusing on export of soybean oil. It will take one month to process and export crude palm oil,” said entrepreneur Rungta.

Nepali entrepreneurs process raw palms brought from Indonesia and Malaysia and export them to India. India had imposed a complete ban on imported palm oil on April 12, 2020, saying that it had adversely affected its industries and farmers.

Prior to that, the ban imposed on January 7, 2019, was lifted after one month with quantitative restrictions. India has imposed high tariffs on palm oil imports.

It charges 30.25 percent on crude palm oil imports and 41.25 percent on refined oil. Nepali industrialists import crude palm oil from third countries by paying 10 percent customs duty.

Nepali exporters enjoy zero percent customs duty under the South Asian Free Trade Area (SAFTA) for exporting refined oil to INdia. Due to this provision, industries had exported large quantities of palm oil.

There are 12 industries exporting edible oil to India in the Bara-Parsa corridor and seven in the Biratnagar area. According to government data, edible oil has been the main contributor to Nepal’s export for the past two fiscal years.