The Palm Scribe

Indonesia and India Agreement on Sustainable Palm Oil Development

The Indonesian Palm Oil Board (DMSI), Solvent Extractors Association (SEA) India, and Solidaridad Network Asia Limited (SNAL) have signed a Memorandum of Agreement that reaffirmed cooperation between them on a sustainable development of the vegetable oil sector, including palm oil and is derivatives.

The agreement, which recognized the Indonesian Sustainable Palm Oil (ISPO) and the India National Palm Oil Sustainability Framework (IPOS) as the frameworks for the sustainable development of palm oil production and trade between the two countries, was signed during a high-level meeting at the office of the Coordinating Ministry for the Economy in Jakarta on Monday (16/7), a press release of the coordinating ministry obtained by the Palm Scribe on Tuesday.


“This collaboration will continue and become a mutually beneficial solution for the two countries and this is also in line with the commitment of the leaders of both countries,” Coordinating Minister for the Economy Darmin Nasution said, adding that he hoped the cooperation between the three institutions will strengthen ties between Indonesia and India in the development of the sector of vegetable oils and their derivatives.

SEA President Atul Chaturvedi said that the agreement will open the road for the sustainability of trade in sustainable palm oil in Asia in the long run.

“I am convinced that the synergy between ISPO and IPOS will protect the competitiveness of the palm oil industry, enhance the readiness in facing market demands in the future and meet the national commitment on the production of and trade in sustainable palm oil,” Chaturvedi said.

Indonesia is currently the world’s top palm oil producers with plantations covering 14.3 million hectares and a production of some 40 million tons. Oil palm is a source of vegetable oil that contribute to the meeting of the people’s consumption needs, both in the form of cooking oil and other downstream products or in the form of bioenergy.

The signing of the MoU was witnessed by Nasution and representatives from the ministries of agriculture, trade, foreign affairs and other related government institutions as well as from Indian palm oil companies.

The release said that the delegation also discussed a number of other issuers related to the Indonesia-India trade in palm oil, the synergy between ISPO and IPOS and the development of a roadmap for future cooperation.

SNAL Managing Director, Shatadru Chattopadhaya, who could not be immediately reached for comment, was quoted by DetikFinance as saying after the signing that his side was currently discussing lowering the Indian import tariff slapped on crude palm oil and its derivative products from Indonesia. In March 2018, the Indian government raised its import tariff for palm oil from previously 30 percent to 44 percent and for derivative products of palm oil from 40 percent to 54 percent.

“Discussions are ongoing. But this is not an easy discussion because CPO is not the only commodity, there are Indian farmers who also produces oil from other seeds,” Shatadru was quoted by DetikFinance. He said the matter would be further discussed by a joint committee to be formed between IPOS and ISPO.

India is now the first country to recognize the ISPO standards and it is now hoped that the standard can be recognized as an international one.

While in Indonesia, the Indian delegation will also visit Sintang district in West Kalimantan to meet with local officials and visit locations where Solidaridad was empowering palm oil farmers as well as visit the operation of the Keling Kumang Group.

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