NEW DELHI: Within days of Malaysia’s Premier Mahathir Mohamad resigned from his country’s top job, Indian Commerce Ministry’s investigation arm DGTR said there would be no need to extend bilateral safeguard duty on imports of certain varieties of palm oil from Malaysia.
Last year in August, the Directorate General of Trade Remedies (DGTR) had started a probe into the spike in prices of ‘Refined Bleached Deodorised Palmolein and Refined Bleached Deodorised Palm Oil’ imported from Malaysia, following a complaint from Solvent Extractors’ Association of India.
On September 4, 2019, the government slapped a 5 per cent safeguard duty for a six-month period, taking the total duty on this variety of palm oil to 50 per cent.
This probe was launched before Mahathir was quoted commenting on India’s revocation of special constitutional provisions for Jammu & Kashmir, an issue that led to bitter diplomatic exchanges between India and Malaysia.
His comments saw Indian edible oil traders boycotting Malay palm oil and was followed by restrictions on the free import of the oil. Though, India refused to accept that these steps were designed to punish Malaysia for Mahathir’s comments, most observers saw the moves as just that.
The notification now issued by DGTR said the "Director General does not recommend further extension of bilateral safeguard duty".
Officials said the initial safeguard duty had been slapped after preliminary findings but that "final findings lead us to believe there is no need to continue this". The DGTR said "it may not be necessary to impose safeguard duty beyond the current period of 180 days," adding "it is considered that the bilateral safeguard duty imposed" earlier under the terms of a free trade pact "is sufficient in the present circumstances". Imports from Malaysia rose from 6.26 lakh MT in 2016-17 to 25.96 lakh MT in January-June 2019.