India, the world's largest edible oil buyer, does not plan to cut edible oil duties despite firm domestic prices, Agriculture Minister Ajit Singh said on Saturday.
The country, which imports more than two-fifths of its edible oil needs, imposes a basic import levy of 85 per cent on refined palm oil and 65 per cent on crude palm oil, compared with 45 per cent on soyoil.
It buys palm oil from Malaysia and Indonesia and soy oil from Argentina, Brazil and the United States. Malaysia and Indonesia have been seeking a cut in palm oil duties which they feel are much higher than the duties on soyoil.
"There is no proposal before the government to cut duties on edible oil. It is not under government consideration," Singh.
He said the country's winter oilseed production would fall 25 per cent from last year because of poor monsoon rains in several parts of the country, particularly the groundnut-growing region of Gujarat and the soybean belt in Madhya Pradesh.
Last month, the agriculture ministry said the 2002 winter oilseeds output was expected to fall to 9.89 million tonnes from 13.2 million tonnes in the same season in 2001.
"When oilseeds production will be lower, then edible oil imports will naturally be higher," he said.
Singh said mustard production in the coming summer in Rajasthan, the main producing state, would also be lower because of low soil moisture.
He said domestic edible oil prices had risen because of lower production and tight global supplies. "If you flood the market by cutting duty then the farmer will be left with no incentive to produce."
Singh also said government was trying to ensure that farmers turn to oilseeds production from grains because the country had a huge stock of grains.