Indian Economy / Modi Govt Cuts Import Duty on Major Edible Oils to Provide Relief to Consumers

New Delhi, Sep 24: In a bid to ease inflationary pressures and provide relief to households, the Narendra Modi government has announced a sharp reduction in import duties on major crude edible oils. The move comes against the backdrop of rising international prices that have pushed up domestic retail costs, officials said on Thursday.

According to the notification, the Basic Customs Duty (BCD) on Crude Sunflower Oil has been cut from 10% to nil, while the duty on Crude Soybean Oil and Crude Palm Oil has been reduced from 10% to 5%. Simultaneously, the government has lowered the applicable BCD on refined edible oils, maintaining a 19.25% duty differential between crude and refined variants.

Officials said the rationalisation of duties is aimed at lowering landed costs of imported oils, thereby ensuring that the benefit is transmitted through the domestic supply chain. The measure is expected to moderate edible oil prices, offering relief to consumers while supporting the broader objective of containing food inflation.

The government has emphasised that the duty differential will continue to protect domestic refining capacity and discourage excessive imports of refined oils. This, policymakers believe, will provide a level playing field for Indian refiners and encourage value addition within the country.

In parallel, the Centre has issued an advisory to edible oil associations and industry stakeholders, urging them to pass on the benefit of reduced duties to consumers without delay. Companies have been asked to immediately revise their Price to Distributors (PTD) and Maximum Retail Price (MRP) in line with the lower landed costs.
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Industry bodies have been requested to ensure compliance, with the government warning that it will closely monitor international market trends and domestic price movements. Officials reiterated that further measures could be taken if required to safeguard consumer interests while maintaining a balanced policy environment for farmers and the edible oil sector.

The latest duty cut underscores the government’s focus on stabilising food prices, particularly in essential commodities, as part of its broader inflation management strategy.