KUALA LUMPUR (Jan 8): The Indian government has banned imports of refined palm oil into the country, according to a government notification sighted by theedgemarkets.com.
According to the notification, the import policy for refined bleached deodorised palm oil and refined bleached deodorised palmolein has been amended from ‘Free’ to ‘Restricted’.
The new policy is believed to be in response to Prime Minister Tun Dr Mahathir Mohamad's criticism on India's actions in the Kashmir region and its new citizenship law.
Note that India is the world's biggest importer of palm oil, where it imports most of its refined palm oil from Malaysia and crude palm oil from Indonesia.
Malaysia exported palm oil worth some US$1.65 billion (RM6.9 billion) to India in 2018. Palm oil accounts for 2.8% of Malaysia's gross domestic product and 4.5% of total exports.
The notification dated Jan 8 read: "In exercise of powers conferred by Section 3 of FT (D&R) Act, 1992, read with paragraph 1.02 and 2.01 of the Foreign Trade Policy 2015-2020, as amended from time to time, the Central Government hereby amends the import policy of items under Exim Code 1511 90 of Chapter 15 of ITC (HS), 2017, Schedule-1 (Import Policy)."
Items under Exim Code 1511 90 includes refined bleached deodorised palm oil and refined bleached deodorised palmolein.
As such, the effect of the notification is that the import policy for said items is amended from 'Free' to 'Restricted'.
Yesterday (Jan 7), Reuters reported India has informally asked palm oil refiners and traders to avoid buying Malaysian palm oil, according to sources.