In a bid to safeguard the domestic vanaspati sector from duty-free imports under free trade agreements (FTAs), the government has imposed 4 per cent special additional duty on the commodity's imports from Sri Lanka, Nepal and other countries with which the country has an FTA, with effect from March 20. | |
| The decision has fulfilled a long-standing demand of the domestic vanaspati sector, said BV Mehta, executive director, Solvent Extractors' Association of India. |
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| Imports from Sri Lanka are likely to hit 3 lakh tonne this financial year, as per the association's estimates. |
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| "As the imports are through the duty-free route, they are cheaper than what the products of domestic manufacturers," said Kuldeep Goyal, general manager - commodities, Amrit Banaspati Company Ltd. |
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| The industry was upset that crude palmoil "" a raw material for hydrogenated oils "" is imported at 88 per cent duty from Malaysia, even as duty-free imports of finished products from Sri Lanka and Nepal were flooding the domestic markets. |
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| India has about 260 vanaspati units out of which 120 units have either closed down or are not functional at present. |
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| Over the last few years, the market growth in this sector has stagnated following availability of other cheaper imported oils. Vanaspati is used as a substitute for ghee in most households. Industry estimates vanaspati's domestic market size to be about 12 lakh tonne. |
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