India's edible oil import bill could rise to $14 billion in the current financial year, as oilseeds production may come down due to a deficient monsoon, according to a latest study by ASSOCHAM.
India meets 60 per cent of its annual vegetable oil demand of 17-18 million tonnes (MT) via imports. Palm oils make up over 70 per cent of the country's total vegetable oil imports.
In 2014-15 fiscal, the country's edible oil import bill stood at $10 billion, the highest until then as the rains were deficient in the growing states last year as well.
"..Vegetable oil imports would reach around $14 billion for 2015-16 which was actually around $10 billion last year," the study said.
Edible oil imports would surge as the production of oil seeds is likely to be at the level of 2014-15 due to a deficient monsoon and the demand may also go up this year, the study added.
"..A new record of edible oils import is going to be made this year as production of oilseeds in Gujarat, Madhya Pradesh, Maharashtra, Andhra Pradesh and Tamil Nadu is expected to drop," it said.
The domestic production of oilseeds has not been able to keep pace with the increasing demand in the country.
Low and unstable yields of most oilseed crops, and uncertainty in returns to investment, which results from the continued cultivation of oilseeds in rain-fed, high risk production environments, are the factors leading to this situation of wide demand-supply gap, it added.
The study said oilseed processing sector has been plagued by a slew of technological and policy issues which has resulted in its low efficiency and low capacity utilisation and added that a vibrant and efficient processing sector is a pre-requisite for its growth.