New Delhi: Huge dependence on edible oil imports could jeopardize India’s long-term national interest, ratings and research firm CareEdge said in a report, adding that it has now become imperative to the country to become not only self-sufficient, but also self-sufficient to the extent possible through the “Atmanirbhar Bharat” initiative.
In a report titled “India’s Attempt to Cut Imports and Become ‘Atmanirbhar,’ he said self-sufficiency is economically prudent and strategically sensible. “The recent geopolitical crisis (in Ukraine) leads to restrictions on the import of edible oils, such as sunflower oil, unfavorable measures taken by major edible oil exporting countries regarding the export of palm oil, increasing diversion to biofuels are major challenges for a country importer of edible oil like India,” the report said.
“Thus, it is desirable to increase domestic production of oilseeds to reduce import dependency in an uncertain geopolitical environment amid the growing trend of ‘de-globalization’ around the world,” he added.
India is the world’s second largest consumer and largest importer of vegetable oil, and it covers 55 to 60% of its needs through imports. Although oilseed production in India has increased over the years, production has lagged behind its consumption, resulting in continued reliance on imports.
As a result, the share of imported edible oils as a percentage of total domestic edible oil consumption increased from 52% in FY14 to 63% in FY16 before dropping to 55% in FY16. of exercise 21.
The vegetable oil import bill saw an increase of about 21% in 2020-21 compared to 2019-20, which further increased by 63% in FY22 compared to FY21, despite a drop in the volume of imports, attributable to an increase in prices. of oil in the international market coupled with the depreciation of the Indian currency, the report mentions.
“This has led to the outflow of valuable foreign currencies and the ‘importing of inflation,'” he said.
The relatively low growth in the cultivated area or cultivated area and the stagnation in crop yield have been the main reasons for the stagnation in the production of edible oilseeds in the country.
On the other hand, global oilseed production increased from 447 million tons in FY12 to 607 million tons in FY21, nearly 1.5 times the growth of the India.
“The low growth in oilseed production in India (actually low yield per ha) can also be attributed to the lower level of mechanization in agriculture, as several studies suggest a direct correlation between agricultural mechanization and the productivity of crops, as the use of improved tools has the potential to increase productivity and reduce the cost of cultivation.”
Lately, to bridge the gap, the Government of India launched the National Edible Oil Mission as a centrally sponsored program jointly implemented by the central and state governments with a particular focus on the Northeast region. east and the Andaman and Nicobar Islands.
The Center intends to cover an additional 6.5 lakh hectares for oil palm by 2025-26 and thus achieve the target of 10 lakh hectares eventually.
The production of crude palm oil is expected to increase to 11.20 lakh tons by 2025-26 and 28 lakh tons by 2029-30, according to the research report.