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Amid a sharp rise in imports of refined palm oil, the Solvent Extractors Association (SEA) of India has demanded that the government should increase the difference between the import duty levied on crude palm oil and on its refined form. It has demanded the import duty gap should be raised to 15 per cent from the existing 7.5 per cent in order to provide a level-playing field to domestic refiners.

Edible oil industry body said the current lower import duty difference of 7.5 per cent between CPO (Crude Palm Oil) and RBD (Refined, Bleached and Deodorised) Palmolein is benefitting Indonesia. Once the duty difference is increased, it said RBD Palmolein selling prices by Indonesian refiners will come down and it will also result in huge foreign exchange saving for the country.

SEA further said that India's CPO imports are replacing refined palmolein in last several months. Refined palm oil imports account for over 30 per cent of the country's total palm oil imports, thereby reducing capacity utilisation of Indian refiners, apart from huge disparity in processing. It said ‘our palm refining industry would be reduced to being mere 'packers' seriously compromising heavy investments made in industry. We feel this situation needs to be corrected before investments turn sour and add to the NPAs (Non-Performing Assets) of lenders.’