Ban on export of edible oil extended by one year

The government today extended the ban on export of edible oil by one year, up to March 16, 2010. India is the second largest buyer of edible oil in the world after China.

The ban was imposed on March 17, 2008 in the backdrop of a rapidly increasing inflation rate.

The move was aimed to cool down prices of the commodity in the domestic market.

Significantly, the wholesale price index-based inflation rate expanded the least in more than six years and stood at 2.43 per cent in the week ended February 28.

However, inflation rate of edible oils for the same week was negative at 8.23 per cent. Even on a week-on-week basis, the inflation rate for this product was in the negative territory, signifying a drop in prices.

Extending the export ban today, the Directorate General of Foreign Trade said the relaxations that were earlier provided for some edible oils would not be affected by the extension. The DGFT had, through a series of notifications, relaxed the export ban for some varieties of oils like castor, and also allowed deemed exports to Special Economic Zones and Export Oriented Units.

The government had slashed import duty on edible oils like crude palm oil in April 2008 to increase their availability in the domestic market.