MFN Status to India: Edible Oil Industry Seeks Duty and Tariff Revision

same length of time.

Being perishable item storage for longer duration is yet another challenge.

The working paper further disclosed that on exports front the dominant presence of Indian origin Ghee in Afghanistan reveals the effectiveness of subsidy given by India to the sector.

The lesser/Nil Custom Duty on imports of Palm Oil and competitive tax structure on Indian locally produced edible oil (when compared to Pakistan) are promoting the exports of this product.

It is evident that under same duty/tax regime, after granting MFN status Pakistan will become dependent on India to fulfil its national consumption of the food item.

Moreover, India and China being the largest importers of edible oil in the world, while making purchases enjoys concessional prices and cheaper freight rates as well.

The international market prices are also disturbed at any given point of time besides many other factors when these two giants make purchases to build up their stocks.

In the international edible oil import arena Pakistan occupies 3rd to 4th slot.

Since the exports of Ghee to Afghanistan & Central Asian Republics (CARs) are not materialised (marginal) due to in-house tariff & technical barriers, therefore, importers-cum-manufacturers-cum-exporters are handicapped and cannot compete with India in price negotiation.

Furthermore comparison of duty in Pakistan and India further retards the scope.

The working paper further said that in the absence of any announced national policy and untested effectiveness of regulatory bodies, opening of trade with India under MFN status is likely to give advantage to Indian exporters of edible oil/ vegetable ghee & cooking oil to Pakistan.

India can easily bag the advantages of international market price fluctuation, which is obvious after the closure or retarding of local industry and edible oil imports in Pakistan.

Nevertheless it is for sure that no credit of declining prices shall be shared with Pakistani consumers.

Hence Pakistan will lose its grip on food security and availability of product at affordable prices, industry opined.

Large scale subsidies given by India to its agriculture and manufacturing sectors has to be addressed by imposing anti dumping and countervailing duties on imports from India or similar/identical subsidies be granted to local sectors to compete with them.

Besides eminent food in-security, following industries depending on manufacturing of vegetable ghee/cooking oil will also be affected.

The sectors included soap industry, transport sector and solvent extraction industry, edible oil industry added.