Search the Internet          Tips  Sites: Finance, Investment

Government examining curbs on GM soyoil import

Indian health authorities are studying a proposal to curb imports of soyoil extracted from genetically modified soybeans, a senior government official said on Tuesday.

The issue has stirred a debate within the industry, with some traders saying a ban could spur domestic prices and boost local oilseeds output, but could also raise palm oil imports.

"We don't know about the health hazards of GM oils. That has to be examined," the government official, who declined to be identified, told Reuters.

Agriculture Minister Ajit Singh told a vegetable oil seminar last month there had been complaints of large scale GM soyoil imports and the government intended to curb the inflow.

Singh said soyoil importers might be asked to provide a certificate from the country of origin that the oil was not genetically altered.

India, the world's largest edible oil buyer, imports soyoil from South America and palm oil from Malaysia and Indonesia.

It imported a record 4.83 million tonnes of edible oil in 2000-01 (November-October), up from 4.49 million a year earlier. Of this, it bought 1.4 million tonnes of soyoil and 2.95 million tonnes of palm oil in 2000-01.

DUTY HIKE

Some traders feared restrictions on soyoil imports could spark a surge in palm oil imports, leading to excessive dependence on Malaysia and Indonesia to meet the country's needs.

"It's always better to have multiple oils and many supplier countries," said B V Mehta, executive director of the Solvent Extractors' Association of India.

Instead of banning imports, the government should allow non-GM soyoil at 45 per cent customs duty and GM oil imports at 75 per cent duty, traders said.

The share of soyoil imports rose to 29 per cent in 2000-01 from 16 per cent in the previous year, mainly on lower import duties, while that of palm oil fell to 61 per cent from 68 per cent a year ago, trade estimates show.

India imposes a basic import duty of 85 per cent on refined oils and 65 per cent on crude palm oil, but the levy on soyoil is only 45 per cent due to the country's commitment to the World Trade Organisation.

Some trade bodies said curbs on soyoil imports would raise prices of local oils, and help farmers to grow more oilseeds.

They said a ban on GM soyoil imports might push average local prices of soyoil to Rs 33,000-Rs 34,000 a tonne from the current Rs 30,000.

Commodity analysts say a ban on GM soyoils would be ill-timed as only last month India, after more than five years of debate and trials, allowed commercial production of transgenic cotton, whose oil is consumed in the country.

The American Soybean Association, an grouping of US soybean farmers, said soyoil extracted from genetically modified soybeans was safe for human consumption.

"Eight per cent of all vegetable oil consumed in the United States is soybean oil, and more than half is from genetically modified beans," the association said in a statement.

ALSO READ:
The Rediff Budget Special
Money

Tell us what you think of this report