Question 64 from UPSC CSE 2018 - Economy

Question

Consider the following statements:
1. The quantity of imported edible oils is more than the domestic production of edible oils in the last five years.
2. The Government does not impose any customs duty on all the imported edible oils as a special case.
Which of the statements given above is/are correct?

IASCODEX · Accepted Answer

Correct Option: A. 1 only

Strategy: Focus on quantitative trends and policy specifics. India's chronic dependence on edible oil imports, consistently over half of total consumption, supports statement 1. The assertion of zero customs duty on all imported edible oils is too sweeping, as duties persist on most types to protect local producers; therefore, statement 2 is eliminated.

Key Info: India is one of the world's largest consumers and importers of edible oils. Domestic production from crops like mustard, soybean, sunflower, and groundnut has covered only about 40% of total demand over the past five years, necessitating imports for the remaining 60%. Major imported edible oils include palm oil (primarily from Indonesia and Malaysia), soybean oil, and sunflower oil.

The Government of India regularly reviews import duties to balance the interests of consumers, domestic oilseed growers, and the processing industry. Customs duties vary by oil type and crude or refined status; typical rates in recent years ranged from 15%-35% for crude edible oils and are higher for refined oils. While temporary duty reductions are sometimes made to check inflation, not all imported edible oils are duty-free.

Major policy instruments include:
*   Import quota management
*   Tariff rationalization
*   Anti-dumping measures

The edible oil sector is a critical component of India's agricultural and food security policy framework.

IASCODEX · Answer

Option B: 2 only

IASCODEX · Answer

Option C: Both 1 and 2

IASCODEX · Answer

Option D: Neither 1 nor 2

Consider the following statements: The quantity of imported edible oils is more than the domestic production of edible oils in the last five years. The Government does not impose any customs duty on all the imported edible oils as a special case. Which of the statements given above is/are correct?