A sharp increase in duty-free imports of edible oils from Nepal played a significant role in pushing up India’s overall edible oil imports by 3 per cent during the financial year 2025-26.
Data compiled by the Solvent Extractors’ Association of India (SEA) showed that India imported 166.51 lakh tonnes (lt) of edible oils during the financial year 2025-26 against 161.82 lt in 2024-25, recording a growth of 3 per cent despite higher international edible oil prices and sharp depreciation of the Indian rupee against the US dollar.
BV Mehta, Executive Director of the Solvent Extractors’ Association of India (SEA), said one of the major reasons for the increase in overall edible oil imports was the sharp rise in imports from Nepal under the SAFTA arrangement, whereby Nepal enjoys zero-duty access for export of refined edible oils to India.
Exports more than double
Nepal exported 7.36 lt of edible oils to India during the financial year 2025-26 compared to only 3.45 lt in the previous financial year, recording an increase of 113 per cent. Refined soybean oil constituted the major share of imports from Nepal along with smaller quantities of sunflower oil, RBD palmolein and rapeseed oil, he said.
Had zero-duty imports under SAFTA not been available to Nepal, India’s overall edible oil imports during 2025-26 would likely have remained below last year’s level despite rising domestic demand. The surge in duty-free imports of refined oils from Nepal substantially contributed to the increase in India’s total edible oil imports during the year, he said.
Domestic output meets 40% of demand
India continues to remain structurally dependent on edible oil imports as domestic production fulfils only around 40 per cent of total requirement. “Low oilseed productivity, fragmented landholdings, inadequate irrigation facilities and policy preference towards wheat and rice cultivation continue to restrict growth in domestic oilseed production,” Mehta said.
SEA is of the view that strengthening domestic oilseed production, improving productivity and encouraging value addition within the country remain essential for reducing long-term dependence on edible oil imports and ensuring stability in the domestic edible oil sector.
In this context, Prime Minister Shri Narendra Modi’s recent appeal for moderation in edible oil consumption assumes significance, as reducing excessive consumption alongside increasing domestic production would help lower import dependence, reduce pressure on foreign exchange outgo and improve India’s long-term edible oil security amid rising global supply uncertainties, he added.