ISLAMABAD: The government has decided to abolish two percent additional custom duties on the import of palm oil for shipments originating from all sources except Indonesia for 10-20 June 2022.
Sources told Business Recorder on Monday that the National Tariff Policy 2019-24 (NTP) stipulates that all proposals for levy, amendment or removal of tariffs shall be examined at the Tariff Policy Centre and after approval by the Tariff Policy Board, shall be submitted to the Cabinet or Parliament, as the case may be, for consideration.
It is stated that the Government of Indonesia had unilaterally decided to impose a ban on the export of palm oil since April 28,2022, which created supply uncertainties.
Pakistan is dependent on the import of palm oil from Indonesia as it imports more than 85 per cent of its palm oil from Indonesia.
While the Government of Indonesia has lifted the ban on the export of palm oil w.e.f. 23.05.2022 but at the same time, they have imposed the conditions that the exporters would also need to ensure 33 per cent supply to the domestic market and obtain an export permit. The said conditions are resulting in delays in the shipment of palm oil from Indonesia.
The other origin to import palm oil is from Malaysia where prices are relatively higher from Indonesia due to lower production. It may be noted that a concessionary tariff for palm oil is being applied to Indonesia and Malaysia under their respective FTA/PTA.
The business community has approached the Ministry of Commerce with proposal to mitigate the current situation and ensure sufficient stocks of edible palm oil, by extending certain duty advantage to import of palm oil front Malaysia under Free Trade Agreement ETA.