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SOPA seeks restrictions on edible oil imports

The government should impose restrictions on edible oil imports so as to balance the need-based supply.

The Soyabean Processors Association of India (SOPA) has sought additional reforms in the edible oil sector, following those announced by the government.

Davish Jain, chairman, SOPA said that the government’s move to encourage contract farming will lead to a lot of corporate interest in the farm sector. Now, farmers can combine to farm large tracts and can work to provide specific crop to corporate on wages while retaining their land ownership, he said.

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He felt that the near elimination of APMCs or mandis logically led to abolishing the Mandi Fee (Tax) a very welcome reform which was also a burden on the poor farmer. Removal of GST on agri produce as available to food grains and pulses needs to be extended to the deficit area of indigenously produced oil seeds, he said.

Jain advocated similar reforms in the oil seed sector to make the country self-sufficient in edible oils, more specifically considering the fact that soyabean farming and processing sector has been at the mercy of the rain gods and imports. Our export markets were limited to a small quantity, he pointed out.

The government should impose restrictions on edible oil imports so as to balance the need-based supply. “We need to incentivise export of the oilmeals so that the industry retains viability and contributes to forex earnings,” he said. The processors are hoping for hike in the customs duty on edible oils by 10% to support domestic oil industry and encourage farmers to opt for oil seeds. This must be done if we have to build self-reliance, and most imports are likely to be taxed by the government, Jain said.

He suggested that MSP should be replaced by a more equitable acreage and yield based pricing in other words the Bhawantar scheme. Reforms such as these have led small countries like Israel take lead in the agriculture space, he pointed out.

“Soya processing is an important industry as it crushes the highest grown oil seed crop in India with more than 50 lakh dependent farmers. Soyabean meal is essential ingredient of poultry feed industry, giving employment to millions of people across India,” he said. The industry has been fighting for survival because of low productivity, under utilisation of capacity and lack of export market, he asserted.

Jain said that Covid-19 has affected the poultry and soya industry very badly, adding that there is great anxiety about the revival prospects and outlook for poultry and soyabean processing industry.

Soyabean is the primary oil seed grown in India and accounts for 30% of the country’s oil seed basket. India’s edible oil imports were at 145 lakh tonne in 2017-18 (November-October). India is the world’s largest importer of edible oil.

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