Spurt By Malaysia's Comment On Kashmir, India Is Likely To Impose Restrictions On Import Of Palm Oil From The Country

India, the world's biggest importer of edible oils may soon place restrictions on palm oil imports from Malaysia to the country, reports have said.

New Delhi is considering restricting imports of some products from Malaysia including palm oil, in reaction to the Southeast Asian country¡¯s leader criticism for its actions in Kashmir, Reuters has reported.

REUTERS

India's government was angered after Malaysian Prime Minister Mahathir Mohamad 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.

The Reuters report which is based on information from an unnamed source said that the proposal is still under consideration.

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

Any move to restrict the import of Palm oil by India will have a massive impact on Malaysia's agriculture sector.

AFP/ REPRESENTATIONAL IMAGE

The data by the Malaysian Palm Oil Board showed that India had purchased 3.9 million tonnes of palm oil from the country in the nine months of 2019, making it the single largest buyer.

And, reports of a possible restriction has already had an impact on the industry there.

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

Malaysia's prime minister on Friday said he had not received "anything official" from India.

AFP/ REPRESENTATIONAL IMAGE

Palm oil accounts for nearly two-thirds of India's total edible oil imports, and Malaysia is its biggest source.

But even if the government goes ahead with its plan to restrict the imports, it will not have much of an impact on the domestic market. This is because, Indonesia, the second-largest palm oil supplier to India is willing to sell more of the edible oil to the country.

AFP/ REPRESENTATIONAL IMAGE

It is not just the comment on Kashmir that has put Malaysia on the bad books of New Delhi. The country giving permanent residency to controversial Islamic preacher Zakir Naik, in 2016 has also not gone down well with the New Delhi. Naik is wanted in several cases including money laundering and promoting hate speech.