India eats more edible oil than it grows. Every year, the country buys more than half of what it consumes. It is the world’s largest importer of vegetable oils. This lesson covers how much India produces, how much it imports, and why customs duty keeps moving up and down.
A mustard field in bloom. Mustard-rapeseed is a leading domestic oilseed crop, alongside groundnut, soybean and sunflower. Photo by KAUSIKA BORDOLOI, CC BY-SA 4.0, via Wikimedia Commons.
At a Glance
Four facts to hold on to.
01
~9.1 MMT
Domestic output, MY 2024-25 (USDA FAS).
02
55-60%
Share of demand met by imports.
03
Palm oil
Biggest import: Indonesia and Malaysia.
04
₹1.3+ lakh cr
Yearly forex cost of imports.
MMTMillion metric tonnes.
Basic customs dutyTax on goods entering India; the lever for edible oil prices.
Crude vs refined oilCrude is raw; refined is processed for the kitchen.
NMEONational Mission on Edible Oils, the plan to grow oilseeds.
India’s edible oil production stood at around 9.1 million tonnes in MY 2024-25 (USDA FAS estimate).
Consumption was forecast at about 26.3 million tonnes for the same year, and it keeps rising.
Roughly 55-60% of demand is met by imports. This has held for years, not just one bad harvest.
India is the world’s largest importer of vegetable oils. It imported about 15.96 million tonnes in 2023-24. Around 16.7 million tonnes were projected for 2025-26 (Solvent Extractors’ Association of India).
Three oils dominate the import bill
Palm oil is the biggest import, from Indonesia and Malaysia. It is over half of all edible oil imports.
Major oilseed States (2024-25 leaders): Madhya Pradesh (soybean), Rajasthan (mustard-rapeseed), Gujarat (groundnut), Maharashtra (soybean), Uttar Pradesh (mustard-rapeseed). Boundaries as per Survey of India. Map by Kuldhar Rabha, CC BY-SA 4.0, via Wikimedia Commons.
Remember: India imports 55-60% of its edible oil. Palm is the biggest import. MP leads soybean; Rajasthan mustard; Gujarat groundnut.
True or False: Roughly 55-60% of India’s edible oil demand is met through imports.
Part 2: The Customs Duty Lever
Good to Know
Duty goes up to protect farmers, down to ease prices
The Government always charges customs duty on imported edible oils. It has never waived duty on all of them as a permanent policy.
November 2017: duty on crude palm oil rose from 15% to 30%. Refined palm oil went from 25% to 40%. Duty on sunflower, soybean and mustard/canola oils rose too.
1 March 2018: crude palm oil duty rose to 44%. Refined palm (RBD Palmolein) went to 54%. This came three months before the June 2018 UPSC Prelims.
September 2024: duty on crude soybean, palm and sunflower oil jumped from 0% to 20%. Refined versions rose from 12.5% to 32.5%. (Source: Malay Mail)
May 2025: duty on crude palm, soybean and sunflower oil was cut from 20% to 10% to bring down retail prices. (Source: All India Radio News)
A short history of the oilseed push
In May 1986, the Technology Mission on Oilseeds (the Yellow Revolution) began under Prime Minister Rajiv Gandhi. It aimed to boost output through better seeds and technology.
Oilseed production nearly doubled, from about 12 million tonnes in 1986 to about 24 million tonnes by 1995.
India briefly neared self-sufficiency in the 1990s. Since then, consumption has outpaced production, and import dependence has climbed back.
Per-capita consumption has climbed to roughly 23-24 kg a year. The Indian Council of Medical Research recommends 12 kg.
True or False: India has permanently waived customs duty on edible oil imports.
Part 3: Why the Gap Persists
Great to Know
A yield problem, not just an acreage problem
India’s oilseed yields per hectare trail major global producers.
Oil palm and soybean elsewhere give far more oil per hectare than India’s mustard- and groundnut-heavy mix.
NMEO-Oil Palm (2021) targets oil palm in North-East India and the Andaman and Nicobar Islands. Palm gives a much higher oil yield per hectare.
NMEO-Oilseeds (2024) targets raising oilseed output from 39 million tonnes (2022-23) to 69.7 million tonnes by 2030-31.
A recurring balancing act
Forex drain: edible oil imports cost India over ₹1.3 lakh crore a year.
Price volatility: global oil price swings pass into Indian kitchens. An Indonesian palm export curb can move Indian prices within weeks.
Two constituencies, one lever: farmers want higher duty and prices. Consumers want lower duty and cheaper oil. That is why duty moves both ways.
August 2026: NMEO-Oilseeds progress. A Lok Sabha reply said free seed distribution covered 13.52 lakh hectares in 2025-26, past the 10 lakh hectare annual target. Oilseed output rose to 43.06 million tonnes in 2025-26 from 39.67 million tonnes in 2023-24. That is real progress, but still short of the 69.7 million tonne target. (Source: KrishiCode, citing a Lok Sabha reply)
2024-25 imports. The same reply put edible oil imports at 160.72 lakh tonnes. Palm oil alone was 75.17 lakh tonnes, nearly 47%. (Source: KrishiCode, citing a Lok Sabha reply)
May 2025: basic customs duty on crude palm, soybean and sunflower oil cut from 20% to 10%. (Source: All India Radio News)
September 2024: effective 14 September 2024, duty on crude oils rose from 0% to 20% to support farmers ahead of the new soybean and groundnut harvest. (Source: Malay Mail)
Exam Edge
Previous Year Questions
The import gap and the duty lever have both been tested.
UPSC CSP 2019, GS Paper IQ: Which agricultural commodity accounts for the highest imports by value in the last five years? Correct answer: (d) Vegetable oils. View this question.
UPSC CSP 2018, GS Paper I, Q10Statement 1 (imports exceed domestic production) is correct: 2017-18 imports were 15.12 million tonnes against 7.66 million tonnes of production. Statement 2 is false: the Government has repeatedly raised, not waived, duty. Correct answer: (a) 1 only. View this question.
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