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Prime Minister Narendra Modi on Monday announced National Edible Oil Mission-Oil Palm (NMEO-OP) with a view to boost farming  sector. Stating his vision to reduce the dependence on imports, PM Modi said that NMEO-OP will make India self-sufficient in cooking oils, including palm oil. India imports about 60-70% of its total edible oils requirement, at present. Of the total imports, palm oil constitutes about 55%.

The retail prices of all the oils have nearly or more than doubled from the rates that were prevailing a few years ago. While oil imports have footed big bills on the Indian government, the rising oil prices have also severely added to the woes of an average household.

Rising edible oil prices

The average prices of edible oils in retail markets increased by up to 52% in July compared to the year-ago period, according to official data.

As per the July data, the average monthly retail prices of groundnut oil increased by 19.24% in July over the same month last year. The prices of mustard oil have increased by 39.03%, vanaspati by 46.01%, soya oil by 48.07%, sunflower oil by 51.62%, and palm oil by 44.42% during the period under review.

Import duty cut

To soften the prices of edible oils, the government had cut the duty on Crude Palm Oil (CPO) by 5% from June 30, 2021, until September 30, 2021.

Minister of state for food and consumer affairs Ashwini Kumar Choubey in a written reply to Rajya Sabha has informed that this reduction has brought down the effective tax rate on CPO to 30.25% from the earlier 35.75%. The duty on refined palm oil or palmolein has been reduced to 37.5% from 45%.

Mitigate the higher oil import and consumption bills

The Prime Minister said the government will ensure that farmers get all facilities, from quality seeds to technology to promote farming to produce palm oil and other oil seeds. Modi said over Rs 11,000 crore will be invested in the edible oil ecosystem.

The scheme is expected to incentivise the production of palm oil to reduce dependence on imports and help farmers cash in on the huge market.

Modi said that the northeastern states and Andaman and Nicobar Islands could be promoted for palm farming.

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