Ajnappa's sentiment in the market following the changing import policy in edible oils

- Ubhi Bazar ઃ Dilip Shah

- When the government reduces the import duty at home, the price rises in the world market: then what does it mean to reduce the duty?

The recent trend in the edible oil market in the country has seen a rapid reversal. Import duties have been slashed by the government on Wednesday and this has led to volatility in the market. The government has recently reduced the duty once again and there has been a lot of speculation in the market recently about the timing of the reduction after midnight. Did many big heads in the market know in advance that the duty was coming down? Such a discussion has also been heard in the market recently. In addition to the reduction in import duty, traders have been updating the details of their stocks on government portals, the government has told traders. The earlier reduced duty was announced to be effective till the end of September but the recently reduced duty has no time limit. That is what market sources are saying. This has also caused confusion in the edible oil market traders and oilseed growers. According to market sources, the government is committed to increasing production and reducing its dependence on imported goods. On the other hand, the government is also making efforts to increase the import of edible oils in the country by reducing the import duty. This has led to a paradoxical market environment. What does the government really want to do? Such a question has been asked in the market. In India, edible oil prices have skyrocketed as the government has reduced import duties. As a result, despite the reduction in domestic duty, the import cost has not come down significantly as the world market has bounced back and this has not led to the expected fall in market prices, experts said. In such circumstances, consumers are more likely to benefit if GST is reduced instead of reducing import duty. This was stated by market experts. The government has reduced the import duty on edible oils about four times in the last seven months, market sources said. Such incidents have been reported three times in four months. In 2014 and 2015, the government had increased such import duty from time to time and now adopting a strategy to reduce the duty, the government's policy has become like a head start. The confusion in the market has been exacerbated by the recent announcement of an increase in tariff value by the government after the incomplete completion of the import duty.

In fact, veteran market experts are saying that reducing or even abolishing GST would prove to be a more practical step instead of reducing the duty. The experts said that even if the supply of edible oils in domestic rations is provided at cheaper rates instead of reducing the import duty, the prices in the open market can be brought down. The reduction in duty at a time when the country is about to start a new season in oilseeds and oil has also caused resentment in the market and among the peasantry. There is also talk in the market that the reduction in import duty will only benefit big importers and multinationals. New soybean arrivals have started in the US, according to world market news. Palm oil production in Malaysia and Indonesia is also expected to pick up. Homeowners are also expected to start new arrivals soon. Attempts were made to increase domestic production of palm oil in India a few years ago and such efforts were not very successful at that time. Now that such efforts have resumed in the country, the possibility of such efforts being affected by the reduction in import duty is also being discussed in the market. The total availability of various oilseeds in the country has declined since the 2016-17 season. Despite the increase in the area under cultivation, the expected growth in production is not achieved as the yield per hectare is less than expected. In view of this, instead of reducing the duty, the government needs to take steps to increase domestic production per hectare and reduce dependence on monsoon and increase dependence on irrigation. That is what the experts are saying.