The Solvent Extractors’ Association of India (SEA) has said that the Government’s decision to reduce import duty on edible oils is a timely and balanced intervention, particularly in the context of the significant rise in domestic edible oil prices over the past year and the approaching festive season.

The basic customs duty (BCD) on crude soybean oil and palm oil has been slashed from 10 per cent to 5 per cent, and on refined soybean oil and palm oil from 32.5 per cent to 27.5 per cent.

Meanwhile, the BCD on crude sunflower oil has been abolished; previously, it was 10 per cent. But import duty on refined sunflower oil has been trimmed to 22.5 per cent from 32.5 per cent. The duty cuts are effective from September 24.

Sanjeev Asthana, President of SEA, said the present duty adjustment needs to be viewed in the context of the approximately 25 per cent increase in international edible oil prices and a 12-15 per cent increase in domestic prices over the past year, along with the approaching festive season.

The Consumer Price Index jumped to 4.8 per cent, while food inflation has risen to 5.95 per cent from 5.52 per cent a month before, which is also a concern for the Government. The immediate objective is to moderate the burden on consumers, while retaining the duty differential between crude and refined oils, which ensures that the domestic refining industry continues to have an important role in the value chain.

“It is, therefore, a balanced approach addressing both consumer and industry considerations,” he said.

With international edible oil prices remaining an important determinant of domestic prices, the reduction in import duty should help soften the impact of elevated global prices on Indian consumers. In fact, SEA expects the measure to have a bearing on the emerging issue of refined edible oil imports into India from Nepal under the existing bilateral trade framework.

BV Mehta, Executive Director of SEA, said: “Without any change to the bilateral trade agreement between India and Nepal, a lower domestic import duty could reduce the arbitrage advantage associated with such imports from Nepal and thereby moderate the incentive for large scale inflows.”

He hoped that the benefit of lower import costs could be reflected progressively in the domestic market.

The Indian edible oil sector remains structurally dependent on imports to bridge the gap between domestic production and consumption. Consequently, a predictable and calibrated import duty regime is important for maintaining consumer affordability, domestic processing capacity and long term oilseed production incentives, he said.

Published on September 24, 2026