India agrees to buy Vanaspathi products at zero duty

Hiran H. Senewiratne

DELEGATION: A high-powered business delegation was in Sri Lanka to discuss modalities of vanaspathi, pepper and desiccated coconut exports from Sri Lanka to India under the current Indo-Lanka Free Trade Agreement (FTA).

The reason for their visit was to counter the recent reports on India that their blocking importation of certain items such as vanaspathi to India, Counsel on Economic and Commerce Sanjay Sudhir told the Daily News.

The delegation was led by the Director General of Foreign Trade in India K.T. Chackor.

Sudhir said that the outcome of the discussions with the Sri Lanka trade authorities were fruitful and India agree to buy Vanaspathi from Sri Lanka under the FTA for zero duty.

He said that India is fully committed to the FTA, which has never denied duty free market access to Vanaspathi production of Sri Lanka.

It is said that many Indian investors heavily invested in Vanaspathi factory plants under the FTA to penetrate into Indian market. Certain elements in the country spread a rumour that India is going to halt Vanaspathi imports from Sri Lanka and sought a Cabinet approval to release to the local market giving shock waves to certain local industries like the DC industry.

The vanaspathi is a bakery product and its raw materials especially palm oil is mainly imported from Malaysia.

Sudhir said due to the intense lobbying from the Sri Lankan DC industry India has agreed to import 500 tonnes at a reduced duty rate from Sri Lanka under the FTA in India, despite rising duty rates under the Bangkok Agreement.

Further, India has also agreed to import 2500 tonnes of pepper at zero duty in addition to unlimited quantities of pepper under the advance licence scheme.