The government has put a ban on the export of all edible oils for a period of 12 months to check mounting domestic costs and control inflation.

The government has taken the recent step to avoid any additional increase in the demand-supply gap of the cooking medium that has lately become costly to common men.

The ban is effective from March 16, 2008 to March 16, 2009.

In an attempt to put control over inflation, the government had also banned export of sugar, wheat, pulses and skimmed milk powder. Besides, it has also governed exports of rice and onion.

In the wholesale price index (WPI), edible oil has a weightage of 2.76% which is higher than cement (1.73%), wheat (1.38%) and rice (2.45%).

Davish Jain, chairman, Central Organisation for Oil Industry and Trade said, “The ban will not have a major impact on edible oil as exports constitute a small per cent of the entire trade. There was no point in banning export of groundnut oil, which is premium oil and where the realisation is significantly high. The industry could have substituted such export by importing higher quantities of soya oil or palm oil from the export earnings.”

In 2006-07, India exported around 11,639 tons of edible oil.

However, the country mainly exports groundnut oil, mustard oil and coconut oil in smaller quantities.

In an announcement dated March 17, the Directorate General of Foreign Trade stated that the recent ban will also wrap agreements under the transitional arrangements. This means exporters who got “letters of credit” for export on or before March 17 will not be permitted to fulfill their commitments.

With the help of imports, India meets up around 45% of its edible oil requirement.

During the last month, the agriculture ministry also issued another advanced figures to put this year's rabi oilseed production at 9.59 million tonne, down 6.7% as compared to the last year.