News

    NEW DELHI, MARCH 18: THE Union government has allowed duty -free imports of up to 30,000 tonnes of milk powder and 15,000 tonnes of butter oil to overcome possible shortages of the essential items.

   The imports are, however, subject to a tariff rate quota (TRQ) arrangement, allowing only certain designated  agencies to bring in these goods at zero per cent duty.

  Milk powder imports generally attract 60 per cent basic Customs duty and butter oil 30 per cent.

   So far, the TRQ regime permitted milk powder imports of up to 10,000 tonnes at a concessional five per cent duty during any financial year.

  But, through a recent notification, the Central Board of Excise and Customs (CBEC) liberalised the in-quota quantity, by trebling it to 30,000 tonnes and also slashing the duty on such imports from five to zero per cent.

  Butter oil so far was not covered under TRQ, with all imports uniformly assessable at 30 per cent. But now, even this commodity (which includes white butter and anhydrous milk fat) has been brought under TRQ, with an in-quota duty free import of 15,000 tonnes.

  The duty-free imports in both cases are subject  to ‘Condition No.1′, that restricts the imports to those holding TRQ allocation certificates issued by the Directorate General of Foreign Trade (DGFT).

  In the case of milk powder, the only entities eligible for allocation by the DGFT are the National Dairy Development Board (NDDB), STC, MMTC, PRC and Nafed.

  The DGFT has not yet specified the eligible agencies for butter oil, but indications are that here too, only NDDB and the state-owned enterprises would be granted TRQ allocations.

  At the same time, NDDB has reportedly contracted large quantities of milk powder and butter oil from New Zealand’s Fonterra Dairy and the Irish Dairy Board.

  NDDB had, earlier, sought a ban on export of all dairy products, including casein, which enjoys a nine per cent duty.

 But the Agriculture Ministry opposed the move. The Centre has now opted for import liberalisation instead of export restrictions.