Edible oil traders in Nepal have called on the government to reduce customs duty on sunflower oil, warning that a lower rate in India could make illegal imports into Nepal more likely.
India cut customs duty on crude sunflower oil from about 16.5 percent to 5.5 percent, effective September 24. Traders in Kathmandu say the gap between the countries’ duty rates could increase the incentive to smuggle the oil into Nepal.
Traders warn of rising smuggling risk
The traders are asking Nepal to lower its customs duty in response to India’s reduction. They argue that the difference in duty rates may make sunflower oil imports through illegal channels more attractive.
The demand comes as Indian crude sunflower oil faces a customs duty of 5.5 percent, compared with the previous rate of about 16.5 percent.
