Switchover to bio-fuels could threaten edible oil production

Agra: India could face a crisis in edible oil, resulting from a switchover to bio-fuels.

At least that is what D S Sri Dhara, president of the Central Organisation of Oil Industries and Trade, says. According to Dhara, the new conflict between bio-fuels and edible oils that were affecting consumers particularly in developing countries.

Shiv Kumar Rathod, president of UP Oil Millers' Association said there was a 10 per cent shortfall in production this year due to poor rainfall. This, coupled with diversion of edible oils to production of bio-fuels, had set the stage for a major crisis in the future. He was addressing a conference of oil millers, traders, and agricultural scientists that expressed concern over the raw deal the edible oil sector received from the national budget for 2008-09.

According to B V Mehta, executive director of the Solvent Extractors Association of India, ''India is importing substantial quantities of edible oil and we had to pay custom duties to the tune of Rs7,000 crore. This impacted the prices in the retail market.''

Sri Dhara has asked the central government to start a special fund for the development and promotion of oilseeds, saying that his association has already drawn up an action plan. The Indian Council of Agricultural Research also has some plans ready to deal with the impending crisis, he said.

The conference was informed that only 60 per cent of domestic demand was met by home production, and the remaining had to be met through imports. The central government, conference participants said, had no long-term policy for this sector.