Indian edible oil industry seeks action on Nepal’s packaging and import policies

Industry bodies representing India’s vegetable oil sector have called on the Indian government to address trade issues with Nepal, citing concerns over packaging regulations and duty-free refined oil imports, according to agency reports. 

The Solvent Extractors’ Association of India (SEA) has urged a review of Nepal’s rule mandating that imported edible oils be packed in consumer-sized containers of up to five litres, with bulk imports now disallowed. SEA argued this regulation disrupts Indian exports—particularly of soyabean and sunflower oil—and violates the principles of the South Asian Free Trade Area (SAFTA). SEA president Ajay Jhunjhunwala told PTI the rule unfairly targets Indian exporters and undermines regional trade cooperation.

India exported edible oils worth approximately INR 3,400-crore to Nepal in the previous year. Since the enforcement of the new rule, volumes have dropped significantly. SEA has written to the Ministry of Commerce and Industry, asking the government to engage with Nepali authorities and consider trade retaliation if a resolution is not reached.

The Indian Vegetable Oil Producers Association (IVPA) also raised concerns, calling for a review of duty-free refined oil imports from Nepal. The association said these imports are affecting Indian processors, lowering farmgate prices for oilseeds, and leading to underutilised capacity. The statement followed a two-day global roundtable marking IVPA’s 50th anniversary.

Both SEA and IVPA have urged the government to find a balanced solution that safeguards domestic industry interests while adhering to trade agreements.