Previous Year Question
Consider the following statements:
The quantity of imported edible oil is more than the domestic production of edible oils in the last five years.
The Government does not impose any customs duty on all the imported edible oils as a special case.
Which of the statements given above is/are correct?
1 only
2 only
Both 1 and 2
Neither 1 nor 2
Correct Answer: A
Detailed Solution
Statement 1 is correct.
Quantities in lakh metric tonnes:
Oil year | Domestic availability | Imports |
2013-14 | 101.90 | 109.80 |
2014-15 | 92.00 | 138.50 |
2015-16 | 86.30 | 148.50 |
2016-17 | 100.99 | 153.17 |
2017-18 | 103.80 | 145.92 |
Imports exceeded domestic availability in every year. Statement 1 is therefore supported by the official data for the five-year reference period.
The principal causes of India’s dependence on edible-oil imports include:
comparatively low oilseed productivity relative to domestic demand;
insufficient domestic production of palm oil;
growth in population and per-capita consumption;
a structural gap between domestic production and demand; and
international availability of palm, soybean and sunflower oils.
Palm oil forms the largest component of India’s edible-oil imports. Soybean oil and sunflower oil are also imported in substantial quantities.
Statement 2 is incorrect. The Government does not provide a complete customs-duty exemption to all imported edible oils. At different times, it has:
prescribed different rates for crude and refined edible oils;
reduced duties to moderate domestic prices; and
increased duties to protect oilseed farmers and the domestic refining industry.
A temporary reduction or exemption for a particular edible oil does not mean that all imported edible oils are permanently exempt from customs duty.
Current position (2026)
According to the Department of Food and Public Distribution’s complete data for 2024-25:
domestic edible-oil availability: 126.30 LMT
edible-oil imports: 160.72 LMT
total availability/consumption: 287.02 LMT
self-sufficiency: approximately 44%
share of imports: approximately 56%
Imports therefore continue to exceed domestic availability.
The Government does not allow all edible oils to be imported duty-free. In June 2025, the Basic Customs Duty on major crude edible oils—crude palm, soybean and sunflower oils—was reduced from 20% to 10%. The import-duty differential between crude and refined edible oils was maintained at 19.25 percentage points to support domestic refining.