Crisis-ridden Vanaspati producers to hold protest tomorrow
NewKerala.com
9 January 2006
New Delhi: Threatened with virtual closure of domestic Vanaspati industry, manufacturers for the first time will resort to workers-type-demonstration, staging a march to the Parliament, as a protest against import of Vanaspati on zero-tariff from Sri Lanka under Free Trade Agreement (FTA) that rendered the local production uncompetitive.
’’The import of Vanaspati under FTA from Sri Lanka to India does not meet the government rules which stipulate minimum of 35 per cent value addition. But the process of conversion of crude oil to Vanaspati after hyderogenation remains much below the official parameters,’’ said All India Vanaspati Industries Sangharsh Samiti, the sponsor of the proest, here today.
To circumspect the official condition, the Samiti alleged, that the ’’CIF prices of Vanaspati imported from Sri Lanka is inflated to 780 dollars a tonne against 470 dollars per tonne even if the same process adopted on import the same material from Malasyia.’’ ’’The over-invoicing is being done to show the value addtion has been achieved,’’ the Samiti added.
The domestic manufacturers have to pay an effective increased custom duty of 90 per cent on the imported crude Plam oil. Besides, the official rules make the use of 20 per cent of local oilseeds mandatory in Vanaspati manufacturing, which increases the cost production to above Rs 43,000 a tonne.
In comparison to that, the imported Vanaspati from Sri Lanka costs around Rs 27,600 a tonne and that from Nepal at Rs 31,200 a tonne. While a cap on the import of Vanaspati from Nepal to India has been fixed at one lakh tonne, there is no such restriction on the Sri Lankan exports.
The Samiti statement alleged that the Indian industrialists, who have set up their ’units’ in different names in Sri Lanka and Nepal too take the advantage of Indian trade agreement (FTA). They are realising the huge profits only by routing the imported crude palm oil from Malaysia to India and sending the money thus earned through ’Hawala’ transactions.
The domestic productuion is around 12 lakh tonnes. Of the 260 units, 120 have already been closed and remaining are fuctioning at 20 per cent of their capacity, the statement said.
The manufacturers are also sore that despite the government’s committment last year, the Vanaspati has not put on the negative list under the trade agreements with neigbhouring countries.
On the contrary, Pakistan has already been put Vanaspati along with 1350 items at the ’negative list’ to protect their domestic producers.
Samiti representative S P Kamrah said they were also having support of the farmers’ unions and employees as the cheaper import would ultimately hit the prices of coming oilseeds crop and 4000 labourers through closure of units.
