India reduced the basic import tax on crude and refined edible oils by 10% on Friday to control inflation in oils and fats while supporting the domestic processing industry. The decision is expected to lower edible oil prices, boost demand, and increase international purchases of palm oil, soybean oil, and sunflower oil.
India has reduced the basic customs duty on crude palm oil, crude soybean oil, and crude sunflower oil from 20% to 10%, according to a government notification.
As a result, the total import duty on these oils will drop from 27.5% to 16.5%, factoring in additional charges such as the Agriculture Infrastructure and Development Cess and the Social Welfare Surcharge.
India relies on imports to meet over half of its domestic edible oil demand.
According to Business Standard in April 2025, the Consumer Price Index (CPI) indicated a decline in food inflation to 1.78%, down from 2.69% in March. Among all categories, oils and fats, along with fruits, were the only items to record double-digit inflation during the month.
Despite a strong mustard harvest in India, rising global prices have led to increased edible oil costs, with mustard oil now averaging over Rs 170 per liter—about 25% higher than usual.
Compared to the previous year, palm oil’s average retail price surged by 34%, reaching Rs 134 per liter as of May 28. Sunflower oil experienced a 30% increase, while soybean oil registered the smallest rise of 18%, now selling for Rs 147 per liter in the domestic market, as reported by The Times of India.
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