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Malaysia to ask India to cut palm oil tariffs

Malaysia will urge India to cut tariffs on imported palm oil...

Malaysia will urge India to cut tariffs on imported palm oil when Prime Minister Atal Bihari Vajpayee visits the country next week, a minister said.

Prime Minister Mahathir Mohamad has agreed to raise the matter with Vajpayee, primary industries minister Lim Keng Yaik said on Saturday.

Lim, quoted by Bernama news agency, said India imposed import duty of around 92 per cent on palm oil but only around 51 per cent on soybean oil.

"This has caused a discount for soybean oil to the tune of $80 a tonne. At present, palm oil price of $220 per tonne, a discount of $80 is a lot of money," he said.

Lim said that he was confident Vajpayee, who starts a four-day visit on May 13, would be sympathetic to Malaysia's case.

He said that Malaysia exported about 2.4 million tonnes of palm oil to India last year while Indonesia exported between 800,000 and 900,000 tonnes.

Lim also expressed confidence that palm oil prices would rise later this year following Malaysian initiatives to cut its stockpile and production.

Last week, Lim said Malaysia was nearing agreement with India and China on a multi-billion-dollar deal to swap palm oil for railway contracts.

He was quoted as saying that he expected the deal with India to be finalised during Vajpayee's visit.