Why in News?
Parliamentary Standing Committee's report on "Production and Availability of Oilseeds and Pulses in the Country" highlighted high import dependency of edible oil, straining foreign exchange reserves.
Key Findings of the report
- High import share: India imports 56% of its edible oil needs (15.66 MMT in 2023-24)
- Palm oil contributes 60%, Soyabean oil 20% and Sunflower oil contributes 20%.
- Rising consumption outpacing production: Domestic consumption of Oilseeds has always outpaced their domestic availability during every year from 2013-14 to 2022-23.
- Per capita consumption of edible oils has more than doubled from 2000-01 to 2020-21, due to population growth, changing consumption patterns, and increasing urbanization.
Reasons for Import Dependency of Edible Oils
- Reliance on Rainfed Agriculture: Over 70% of Oilseeds are grown under rainfed conditions which makes the sector highly vulnerable to erratic weather patterns, heat-waves and potential El-Nino events.
- Yield Gaps: Almost all Indian edible oil crops exhibit lower yields compared to major global producers, partly due to the lack of genetically modified (GM) and herbicide-tolerant varieties used in other countries.
- E.g. India's groundnut productivity at 2,067 kg/ha vs. Uzbekistan's 15,519 kg/ha.
- Processing Inefficiencies: The Indian vegetable oil sector is hindered by small-scale, low-technology plants.
- The industry currently utilizes only about 30% of its edible oil refining capacity.
- Low Seed Replacement Rate (SRR): The SRR ranges from just 25% for groundnut to 62% for rapeseed-mustard, falling far short of the government target of 80-85%.
- Biotic and Abiotic Stresses: Weeds, pests, and diseases consistently plague oilseed crops in traditional farming systems, reducing yields by 20% or more.
Government Efforts for ensuring Self Sufficiency in Edible Oils
|
Way Ahead: Recommendations of the Committee
- Expanded Procurement: Expanding MSP procurement under Price Support Scheme of PM-AASHA to 100% of national oilseeds production (from 25% at present).
- Incentivize production of Palm oil: Through Viability Gap Payments (VGP) adequately for Fresh Fruit Bunches (FFBs) and subsidizing planting material costs upto 80%.
- Improve irrigation practices: Improve coverage of Per Drop More Crop (PDMC) Scheme should be implemented in rainfed Oilseeds areas; increase subsidies for Small/Marginal farmers for purchasing drip and sprinkler systems; train Farmers on micro-irrigation maintenance etc.
- Import Safeguards: Dynamically adjusting import duties based on domestic production and imposing a 20% safeguard duty on palm oil imports if global prices fall below $800/tonne.
- Launch of a 'Bharat Oil' Brand: To protect lower and middle-income households from market fluctuations.
- Seed Pricing and Regulation: A National Commission should be set up to fix the upper price ceiling for seeds to prevent exploitation by private companies.
- Furthermore, a new Seeds Bill must be enacted urgently to regulate modern biotechnology, track quality, and protect seed sovereignty.
- Technological Integration: Adequate investments in biotechnology (like CRISPR-Cas9), Marker-Assisted selection (MAS) etc. to develop climate-resilient high-yielding, and pest resistant varieties.
Conclusion
India's growing dependence on edible oil imports highlights the urgent need to strengthen domestic oilseed production through technological innovation, improved irrigation, better seed quality, and stronger procurement support.
