After excise duty cuts on petrol and diesel, the Centre has allowed import of crude soyabean oil and crude sunflower oil at nil rate of customs duty for two years. Agriculture infrastructure and development cess on the products too has been reduced to nil to curb the rising edible oil prices, which are fanning the food inflation.
As per a finance ministry notification, the import of 20 lakh MT each of crude soyabean oil and crude sunflower per year will remain duty free.
On May 21, in a slew of measures to control the rising inflation in the economy, the government announced reduction in the central excise duty on petrol and diesel and subsidy of ₹200 on LPG gas cylinder. The excise duty cut on petrol and diesel and subsidy outgo on LPG cylinders will cost over ₹1 lakh crore to the central government.
India’s retail inflation rate in April soared to an eight-year high at 7.79% over 4.23% in the same month of the previous year, fuelled by the high prices of vegetables and oils. Also, food inflation rate in April soared to 8.38% compared with 1.96% in the same month of the previous financial year.
It may be noted that the inflation rate in oils and fat in April zoomed to 17.28% on account of high edible oils in April 22 vs April last year, while vegetable prices have gone up by 15.41%. The Russian invasion on Ukraine has stoked a price spiral in the edible oil due to supply disruption as Ukraine has been a major supplier of sunflower oil.