The Government today imposed a 2.5 percent import duty on crude edible oil to protect domestic farmers, but kept the duties unchanged on refined cooking oil fearing a hike in retail prices.
The decision was taken at the Cabinet Committee on Economic Affairs (CCEA) meeting held here, a source said.
At present, crude edible oil attracts no import duty but there is 7.5 percent duty on refined edible oil.
India imports about half of the total domestic requirement of cooking oil.
In 2011-12 oil year (November-October), the total import of vegetable oils (edible and non-edible oil) was at an all-time high of 10.19 million tonnes. In the first two months of the current oil year, imports were up 5 percent.
The Agriculture Ministry had proposed an increase in the duty on crude edible oil to protect the interest of palm growers, particularly from Andhra Pradesh.
Earlier this week, Agriculture Minister Sharad Pawar, Finance Minister Pranab Mukherjee and Food Minister KV Thomas reviewed edible oil imports and discussed the issue of raising the duty on edible oil.
The Agriculture Ministry wanted 7.5 percent import duty on crude edible oil and 15 percent on refined oil. But during the inter-ministerial meeting, the finance ministry felt such a sharp rise would lead to rise in inflation.