In the first five months of the current fiscal year, Nepal has imported crude palm, soybean, and sunflower oil worth Rs 58.9784 billion from third countries.
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Nepal has imported about Rs 59 billion worth of crude edible oil and exported Rs 52 billion worth of refined edible oil to India in the first five months of the current fiscal year. Data from the Customs Department shows that Nepal's edible oil trade is largely based on re-exports.
In the five months of the current fiscal year, Nepal has exported a total of 116.5 billion rupees worth of goods to various countries. Out of this, Nepal exported 52.8 billion rupees worth of soybean oil, sunflower oil and palm oil to India alone.
In the five months of the current fiscal year, Nepal has imported 58.97 billion rupees worth of crude palm, soybean and sunflower oil from third countries. Similarly, refined palm oil worth 1.95 billion rupees has been imported.
On May 30, 2025, the Indian government had reduced the customs duty on crude palm oil, soybean oil and sunflower oil with the aim of controlling retail prices and protecting domestic refiners. The basic customs duty on crude edible oil has been reduced from 20 percent to 10 percent. Indian media reported that the total import duty has come down from 27.5 percent to 16.5 percent. The duty on refined edible oil remains at 35.75 percent.
India had increased import duty on both crude and refined edible oils by 20 percent in September 2024 with the aim of protecting domestic oilseed farmers. Nepal had an unexpected benefit from the decision. Therefore, on May 30, India reduced the duty on crude oil imports by 10 percent, while the duty on refined oil remained the same.
Experts had also suspected that India's tax revision would have a major impact on the export of refined edible oil from Nepal. In India, traders have to pay 16.5 percent duty when importing crude oil and 35.75 percent duty when importing refined oil.
Nepalese traders have to pay 24.30 percent duty when importing crude oil from third countries and 18.65 percent duty when importing from SAARC countries. Crude oil is imported from third countries. There is no duty on importing crude oil in Nepal and exporting refined oil to India. That is, under the South Asian Free Trade Area (SAFTA), exports to India are exempt from customs duties.
In the first five months of the current fiscal year, the highest amount of crude soybean oil and sunflower oil has been imported from Argentina. According to the department, crude soybean oil worth Rs 39.24 billion and crude sunflower oil worth Rs 5.21 billion have been imported from Argentina.
Crude soybean oil worth Rs 4.85 billion 61 million has been imported from Brazil, Rs 1.47 billion 88 million from Paraguay, and Rs 1.39 billion 48 million from Thailand.
Sunflower oil worth Rs 1.84 billion 30 million has been imported from Ukraine and Rs 2,000 from India. Crude palm oil worth Rs 3.66 billion 90 million has been imported from Indonesia, Rs 1.38 billion from Thailand, and Rs 239 billion 98 million from the Philippines.
Former Joint Secretary and Trade Expert Ravi Shankar Sainjule says that there is no significant value addition in importing and exporting raw soybean oil. Currently, most edible oil exports are limited to minimal processing, and in most cases, imported liquid oil is repackaged and exported.
'The increase in edible oil exports has only benefited a few business groups, and has not created real value addition or employment in Nepal,' he said. 'Therefore, emphasis should be placed on exporting goods produced in Nepal or at least significant value addition should be ensured when re-exporting.'
If soybeans are imported and oil is produced and exported, a large number of jobs will be created and even the oil cake can be sent abroad, says Sainjule.
