1. Commodity News

MASUR DAL (Red Lentil): Custom Duty Removed; Agriculture Infrastructure Cess Reduced to 10%

Sugandh Bhatnagar
Sugandh Bhatnagar
Custom Duty removed on Masur Dal; Agriculture Infrastructure Cess slashed to 10%
  • The central government has cut the import duty to zero and also halved the Agriculture Infrastructure Development Cessin order to boost domestic supply and check rising prices. 

  • The retail prices of Masoor Dal had increased by 30% to Rs 100 per kg while it was only Rs 70 per kg in April, 2021. 

A notification was tabeled in Rajya Sabha by Finance Minister Nirmala Sitharaman that stated reduction in Custom Duty to nil on lentils originated in or exported from countries except USA. The custom duty has been reduced from 30% to 20% on Masur originated in or exported from USA. Also, the Agriculture Infrasture Cess on Masur has been reduced from the present rate of 20% to 10%

This step has been taken in order to avoid any further increase in the prices of Masur, which will mostly remain range bound and boost the domestic supply. While Indian pulses and Grains Association claims that the government’s decision to reduce import duty on masur will not help reduce masur prices in India. It will only help Canadian and Australian farmers to who will export to India.

Current Prices of Masur :

Wholesale prices at Mumbai market are around Rs 66000/ quintal from around Rs 59000/quintal in March, a rise of about 12% in four months. According to trade estimates, India consumes about 20 Lakh tones of Masur in a year, while it produced about 9 Lakh tones during the previous Rabi season.  

About Agriculture Infrastructure Development Cess:

The government had introduced the Agriculture Infrastructure Development Cess on certain items, in order to improve Agriculture infrastructure aimed at not only boosting production but also in helping conserve and process farm output efficiently. It is kind of a special purpose tax which is levied over and above basic tax rates. The government however, makes sure that not much of additional burden is put on the consumers.

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