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By Jayanti Kajale, Gokhale Institute of Politics and Economics, Pune
The paper looks into various aspects of the edible oil sector in India and assesses the impact of international and national developments on the domestic soybean sector. It cautions that liberalisation of the industry should be done carefully if the current advantages are to be maintained.
This was not done in the earlier years of liberalisation when the duty on edible oils was reduced from 65 percent to 15 percent. Domestic prices crashed as imports flooded in and tariffs had to be raised to 85 percent in the 2001-02 budget which served to slow down imports. However, as demand rises, the import of raw oil is expected to increase and this should happen without endangering the domestic industry. The paper reports the findings of a study carried out in two soybean-growing areas of Maharashtra. The findings show that the crop is doing well and there has been new investment in the sector. This growth should not be endangered by lowering protection barriers for domestic industry. Click here to read the full paper in PDF format.
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