India government considering banning Malaysian imports over Mahathir’s Kashmir statement

International

NEW DELHI, (Barwaqt News): India is considering restricting imports of some products from Malaysia including palm oil, according to government and industry sources, in reaction to the Southeast Asian country’s leader criticizing New Delhi for its actions in occupied Kashmir.

India is looking for ways to limit palm oil imports and may place restrictions on other goods from the country, said a government source and an industry source who participated in discussions led by the Ministry of Commerce and Industry on the planned restrictions.

The sources asked not to be named as the proposal was still under discussion.

India’s government was angered after Malaysian Prime Minister Mahathir Muhammad said last month at the United Nations that India had “invaded and occupied” Jammu and Kashmir and asked New Delhi to work with Pakistan to resolve the issue.

India revoked the special constitutional status of occupied Kashmir in August, angering Pakistan.

The government wants to send a strong signal of its displeasure to Malaysian authorities, the sources said.

India, the world’s biggest importer of edible oils, is planning to substitute Malaysian palm oil with supplies of edible oils from countries such as Indonesia, Argentina and Ukraine, said the sources.

Palm oil accounts for nearly two-thirds of India’s total edible oil imports. India buys more than nine million tones of palm oil annually, mainly from Indonesia and Malaysia.

In the first nine months of 2019, India was the biggest buyer of Malaysian palm oil, taking 3.9 million tonnes, according to data compiled by the Malaysian Palm Oil Board.

A spokeswoman for India’s commerce ministry said the ministry could not comment on things that were under consideration.

Malaysia’s prime minister on Friday said he had not received “anything official” from India after Reuters first reported that India was mulling restricting imports of Malaysian palm oil and other products.

The news prompted Malaysian palm oil futures to snap five days of gains to end lower on Friday evening.

The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange that had earlier been trading up on the day, fell 0.9 per cent to close at 2,185 ringgit ($522.23) per tonne.

A Mumbai-based refiner said it would not create a shortage of edible oils in India if buyers there stopped importing palm oil from Malaysia.

 “Indonesia is eager to sell more and more palm oil to India,” the refiner said, adding that India could also increase imports of soy oil from Argentina and sunflower oil from Ukraine to offset any drop in Malaysian palm oil shipments.

Indonesia wants New Delhi to increase palm oil purchases and wants to buy sugar from India in exchange.

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