Govt slashes import duty on edible oil – twice in 1 month! Will that bring prices down during festive season? See this REPORT

Good news for household as we move towards the festive season ahead of us. While the retail inflation for the month of August 2021 has fallen to 5.3 per cent on the back of easing in the food prices, the government has taken yet another step to cool prices further. The Narendra Modi government has cut import duty on edible oil. The import duty has been reduced on palm oil, soya oil and sunflower oil. Full report here.

Zee Business’ Mrituenjay Jha said that the import duty on edible oil has been reduced for the second time in one month.

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The government has cut duty on the import of edible oil by 5.5 per cent. The Government had previously slashed the duty in August.

Another major development is that the Centre has also asked states to take stock of the current stock of edible oil and if there are any existing bottlenecks in the supply side and if there is hording happening.

Jha said that the prices are expected to come down but the impact could not be significant. He said that the correction prices will not be commensurate to the import duty cut.

If the import duty is cut, the price of edible oil usually rise in the international markets, he reasoned. The prices of the edible are expected to come down by at least Rs 4-5, he further said.

He said that the government is working to bring the price of edible oil down during the festive season. This is because the price of edible oil have shot up by 50 per cent over a 1 year period.

The Government has been taking steps to keep the prices in check, State Governments have been taking measures to reduce hoardings.     

The retail inflation based on the Consumer Price Index (CPI) was 5.59 per cent in July and 6.69 per cent in August 2020.

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सरकार ने फिर घटाई खाने के तेल पर इंपोर्ट ड्यूटी। पाम, सोया, सूरजमुखी तेल पर इंपोर्ट ड्यूटी घटी। पूरी अपडेट दे रहें @MrituenjayZee #EdibleOil | #CustomsDuty pic.twitter.com/0HUCwHvujO

— Zee Business (@ZeeBusiness) September 13, 2021

Though, this has not yielded very fruitful results as there are supply side issues and out of the total consumption, 60 per cent is accounted from imports.