Oilseed production boost can cut imports

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Oilseed production boost can cut imports

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• Palm oil story: The govt. approved the Rs.11000 cr NMEO-OP (National Mission on Edible Oils - Oil Palm) to produce more locally, and cut imports. Goal is to meet 40% of demand from local production. But palm oil is very bad for the environment, and has health issues too.
• Cheaper: Traders often blend the cheaper palm oil with other edible oils. Healthy edible oils, produced domestically, include mustard, sunflower, safflower, groundnut, sesame, niger, and coconut. Households in India have stayed away from palm oil always, but those making junk food, processing industry, cosmetics and FMCG products use it heavily. 
• New scheme: The proposal is to raise the area under palm oil plantations, to 10 lakh ha by 2025-26, and 16.7 lakh ha by 2029-30. Plantations are being planned in northeast India, and Andaman Nicobar islands (all ecologically sensitive zones).

1. Subsidy is being given to farmers, including 100% on fertilizers
2. Guaranteed price is being committed (Volatility price will be based on avg. crude palm oil (CPO) price of 5 years, adjusted with WPI, multiplied by 14.3%)
3. Processing industry to pay the growers, and in any trouble, govt. to give 2% CPO incentive to industry

• Imports, costs, ecology: India spends more than Rs.75000 cr on importing 55-60% of its edible oil needs, but this is when the IPCC has warned of rising deforestation as contributing to biodiversity destruction, and climate change. When natural rainforests are cut down, and replaced by monoculture plantations, species lose their habitat, and carbon emissions rise.  [IPCC - Intergovernmental Panel on Climate Change]

1. Sri Lanka has banned any fresh oil palm plantations, and existing would be eradicated soon
2. Local research groups too have warned against turning biodiversity-rich areas into oil palm plantations

• The real question: How did India turn from being self-sufficient in edible oils (1993-94) to becoming the biggest importer of edible oils? 

1. Yellow Revolution came with the "Oilseeds Technology Mission" 1985-86, that pushed local oilseed production as well as processing
2. Then came the WTO commitments, and India reduced import tariffs (Agreement on Agriculture)
3. Despite the rule allowing India to bound importa tariffs at 300%, India kept reducing the same (pressure from import lobbies), touching near zero 
4. Domestic oilseed producers shifted to other crops

• Focus again on oilseeds: The govt. ought to give guaranteed prices to oilseed producers, just as it's promising to do with oil palm producers now. A guaranteed price and proper procurement for the oilseeds farmers (most being small) can revitalise Indian agriculture. Many may want to shift from rice to oilseeds. 
• Many, not few: Palm oil plantations will mainly benefit large absentee landlords, and industry giants. Oilseed supporty will benefit millions of small farmers. The Yellow Revolution will pick up again. Biodiversity will be protected, and natural forests too.
• Save the water: On one hand, the intensive wheat-paddy crop rotation is blamed for groundwater depletion. And now, oil palm - a water-guzzling crop - is being promoted. One tree consumes 300 litres water daily! 
• Summary: Forget oil palm plans, and re-energise the now dead "Yellow Revolution". That will bring self-sufficiency in edible oils, without destroying our environment.

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