Saturday, 28 January 2023

Cabinet Approved 11,040 cr to cut palm imports

Cabinet Approved 11,040 cr to cut palm imports

On Wednesday, the Union Cabinet Approved 11,040 cr crore project to try and increase domestic production of palm oil, aiming to cut India's heavy dependence on edible oil imports.

The National Mission on Edible Oils-Oil Palm (NMEO-OP) will focus on and Andaman and Nicobar Islands North-eastern region.

The cabinet secretariat said.

"Due to the heavy dependency on imports of edible oils, it is important to make attempt to increased the domestic production of edible oils in which increasing area and productivity of oil palm plays an important part,"

India imported palm oils—both crude and refined—worth $5.8 billion in FY21, mainly from Indonesia and Malaysia. The government said that around 98% of crude palm oil (CPO) is importing. The scheme proposes to increase the coverage of oil palm trees to 1 million hectares (ha) by FY26 from 370,000 ha at present. CPO production will increase to 1.12 million tonnes (mt) by FY26 and up to 2.8 mt by FY30.

Cabinet Approved 11040 cr to cut palm imports 1getty image

Read More: Hike in MSP for paddy ,oilseeds and pulses

Cabinet Approved 11,040 cr while Centre will contribute ₹8,844 crores, while states have to contribute ₹2,196 crores, including viability gap funding.

The press statement said.

"The scheme will benefit palm oil farmers, increase capital investment, generate employment, reduce import dependence and also increase the income of farmers,"

The government will also provide viability gap funding to protect farmers from international price volatility in crude palm oil by paying directly to farmers' accounts in the form of direct benefit transfers. "This assurance will inculcate confidence in Indian oil palm farmers to go for the increased area and thereby more production of palm oil," the statement said. The scheme will end on 1 November 2037.

To give impetus to the northeast and Andamans, the government will bear 2% of the CPO price to ensure farmers got payment at par with the rest of India. "The states that adopt the mechanism would benefit from viability gap payment proposed in scheme, and for this, they will enter into MoUs with the Centre," the statement said.

India is the world's largest importer of palm oil, buying more than 9 million tonnes annually, mainly from Indonesia and Malaysia.

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