News: Prime Minister Modi in his Independence Day speech, announced a new central scheme to promote Mission on Palm oil. Read The News Here
Let’s understand in simple language:
India is a big consumer and importer of edible oil. India produces about 11 million tonnes of edible oil but consumption is about 24 million tonnes. Of all the edible oils, India imports around 56 % of palm oil. Palm oil is mainly imported from Malaysia and Indonesia.
Looking at the rising imports, India has decided to boost palm oil farming. The special focus will be on Andaman – Nicobar Islands and the North-Eastern Region. This move will save India a lot of FOREX (Foreign Exchange) and also improve employment opportunities.
The Cabinet thus has approved the National Mission on Edible Oils – Oil Palm (NMEO-OP) with funding of 11040 crores of which 8844 crore rupees will be provided by the centre and the remaining 2,196 crore rupees will be shared by the state governments.
This new scheme National Mission on Edible Oils – Oil Palm (NMEO-OP) will subsume the already existing National Food Security Mission-Oil Palm program. With this, the oil production (crude palm) in the country is expected to go up more than twice till 2029-30.
Viability Price: (What is Viability Price?)
Palm oil farming is laced with its own challenges. If the farmer starts cultivating now, the gestation period for oil production and gaining profits can vary from 5 to 7 years. Moreover, the farmer will still be unsure of reaping satisfied profits due to the price changes and volatility in oil prices. To overcome this doubt, the government has decided to give price assurance to palm oil farmers producing Fresh Fruit Bunches (FFBs). This price assurance will be known as Viability Price.
This ‘viability price’ will be the annual average Crude Palm Oil price of the last five years adjusted with the wholesale price index and then multiplied by 14.3%. This price will be fixed monthly and if the need arises the money will be directly transferred to the farmer’s account under the Direct Benefit Transfer (DBT) Scheme. This move will inculcate confidence in the Indian oil palm farmers to go for the increased area and thereby more production of palm oil.
National Mission on Edible Oil-Oil Palm (NMEO-OP):
- A new Centrally Sponsored Scheme with a special focus on the North east region and the Andaman and Nicobar Islands.
- A financial outlay of Rs.11,040 crore out of which Rs.8,844 crore is the share of Government of India.
- Focus on increasing area and productivity of oilseeds and Oil Palm.
- Assistance to seed gardens specially for North-East and Andaman regions.
- Price Assurance to Oil Palm farmers for Fresh Fruit Bunches.
- Reduction in Import Dependence.
- Improvement in yields. India produces less than half of the roughly 2.4 crore tonnes of edible oil that it consumes annually. It imports the rest, buying palm oil from Indonesia and Malaysia, soyoil from Brazil and Argentina, and sunflower oil, mainly from Russia and Ukraine.
- Palm oil is currently the world’s most consumed vegetable oil.
- It is used in the production of detergents, plastics, cosmetics, and biofuels.
- Top consumers of the commodity are India, China, and the European Union (EU).
UPSC Questions related to the topic:
Approximately what fraction of India’s total edible oil demand is met through imports?
Which among the following is an oilseed?
5. Wheat Bran
Choose the correct option from the codes given below:
A. 1,2,and 3
B. 2,3,and 5
D. 1,2,3,and 4
What is India’s rank in global groundnut production?
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 a special case.
Which of the statements given above is/are correct
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
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