Edible Oil Imports Stir Unrest: India-Nepal Trade dynamics under Scrutiny

The Indian Vegetable Oil Producers' Association raises alarms over the spike in duty-free edible oil imports from Nepal, questioning the integrity of trade agreements. This surge threatens domestic markets, affects farm-gate prices, and calls for urgent government intervention to safeguard India's agricultural interests.

The Indian Vegetable Oil Producers' Association (IVPA) has formally appealed to the central government, voicing concerns about a significant rise in duty-free edible oil imports from Nepal under the South Asian Free Trade Area (SAFTA) framework.

Early 2025 saw imports soar to over 1.80 lakh metric tons between January and March, a stark increase from 1.25 lakh tons recorded in the entire year of 2024, according to IVPA. The Association suggests a portion of the previous year's imports flooded India during the last quarter, possibly as a rerouted result of heightened Indian duties.

Expressing skepticism about the enforcement of Rules of Origin, IVPA contends that the increased edible oil exports from Nepal, a nation lacking the necessary oilseed production, indicate third-country rerouting. This scenario jeopardizes fair competition, affects local oilseed prices, and undermines domestic refining capacity, posing significant implications for India's fiscal health and its agricultural economy.