At present, the effective duty on olive oil is about 50%, which includes a basic duty of 45%. The Bureau of Indian Standards has also laid down quality norms for olive oil.
Vegetable oil has become a contentious issue in Indias proposed trade agreements.
The Malaysian minister of international trade and industry, Dato Seri Rafidah Aziz, who was here last November, had asked India to reduce its applied tariffs on different grades of palm oils, before the signing of the comprehensive economic cooperation agreement.
The prime minister of Greece, Kostas Karamanlis, who led an official delegation to India last week, had elaborate discussions with the government on the issue of boosting bilateral trade to 1 billion euro by 2010, and also future prospects of the proposed India-EU free trade agreement. Among other items of export interest, Karanmalis also mentioned olive oil.
The Indian commerce minister, Kamal Nath said, We are negotiating with EU for both trade and investment. It will be the largest trade agreement in the world.
According to official sources, the government may consider easy entry of imported olive oil on the grounds of its nutritive value, also to augment availability of vegetable oils with a view to keep price inflation under check.
Greece is the third major olive oil producer, producing more than 3,00,000 tonne annually, out of which 70% is extra virgin olive oil. Karamanlis also mentioned other farm items like fruits, vegetables, dairy products, wine, which Greece wants to export to India. He said feta cheese, masicha from Chios island, ouzo are products of protected designation of origin under geographical indications.
The total size of the olive oil market in India is around 4 million euro in terms of value and 2,000 tonne in terms of volume, out of which Spanish companies command a share of about 60%. The Italian brand Filippo Berio is making forays in the domestic market.
According to the economic and commercial counselor in the Spanish Embassy in India, Jose Antonio Bretones, Spanish companies have set aside a budget of 30,000 euro for generic activities and another 1,50,000 euro for concrete marketing plans in India. Spain is the worlds largest exporter of olive oil.