Nepal | February 28, 2020

India may allow import of palm oil from Nepal

Himalayan News Service

Kathmandu, February 5

India seems to be positive about resuming the trade of refined palm oil from Nepal.

Officials at the Ministry of Industry, Commerce and Supplies (MoICS) informed that the Indian authorities are willing to allow Indian traders to import refined palm oil from Nepal, which has been halted since January 10.

Aimed at taming Malaysia, India had imposed a blanket restriction on import of palm oil. This directly affected the trade of Nepal’s top export item — refined palm oil. Since then, the government has been holding bilateral discussions (both formal and informal) with India to resume the palm oil trade.

A week after the Indian government stopped importing refined palm oil from Nepal, the government on January 18 had formally asked the southern neighbour to allow Nepali traders to export the commodity in the Indian market. Since then, authorities of the two nations have held series of formal and informal discussions to lift the ban for Nepal.

“Indian authorities seemed positive towards allowing its traders to import palm oil from Nepal during the formal and informal discussions held at various levels,” informed a source at MoICS, adding that India, however, is yet to officially respond to Nepal government’s request for exemption from the ban on import of refined palm oil.

Sources at MoICS said that commerce secretaries of both nations are holding discussions every day to resume the trade of country’s largest export item to Indian market.

Nepal has been urging India to lift the ban on import of refined palm oil from Nepal citing that the country is not a bulk exporter of the product and that Nepali traders export palm oil in small packages ranging from one kg to 15 kg, which are widely used by Indian households.

“Our palm oil exports account for a mere one per cent of Indian imports of the commodity,” informed Nabaraj Dhakal, joint secretary at MoICS.

“We are hopeful that the ban on import of refined palm oil from Nepal will be lifted as India’s import restriction on the product did not primarily intend to curb import of the product from Nepal.”

Nepali traders import crude palm oil from Malaysia and Indonesia, process and package it here, before sending it to India. Although Nepal does not have competitive or comparative advantage in exporting palm oil to India, its rising export in recent months had played a crucial role in raising the country’s export base and narrowing the trade deficit.


A version of this article appears in print on February 06, 2020 of The Himalayan Times.


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