India attempts to limit purchase on palm oil from Malaysia. Reportedly, Malaysian Prime Minister Tun Dr. Mahathir Mohamad’s comment on Kashmir was the triggering cause.
Accordingly, India was hot under the collar following Mahathir’s censure at the United Nations last month.
Mahathir opined that India had ‘invaded’ and ‘occupied’ Jammu and Kashmir and propounded that the country should cooperate with neighboring Pakistan to settle the issue.
India, the biggest Malaysian palm oil buyers in the nine months of 2019, is currently looking for substitutes for the products. In so doing, India will try other edible oils as an alternative from countries such as Indonesia, Argentina, and Ukraine.
If that happened, Malaysia would be in jeopardy for India previously consumed approximately 3.9 million tonnes of palm oil products in the aforesaid period.
Even worse, India is also considering restrictions on other products from Malaysia. However, New Delhi has yet to impose the restriction. That said, this is India’s way to express their prodigious displeasure.
Malaysia Studies the Possible Impacts on India’s Palm Oil Trade Action
Considering India’s combative measure, Mahathir and the government will rigorously study the case and its possible impacts. Malaysia appears to perceive India’s course of actions as an excess.
In his defense, Mahathir reminded that the trade between the two countries is never one-directional. Hence, Malaysia might implement the same thing if India applies its actions.
“They are exporting goods to Malaysia too. It’s not just one-way trade, it’s two-way trade,” Mahathir stated.
Likewise, Malaysia also imports several key products from India. The products include petroleum products, live animals, meats, metals, and chemical products.
With this in mind, Malaysia might impose tariffs or even restrict trades of such products. Furthermore, none will acquire benefits if such phenomena truly occur.
If, by any chance, the situation prevails longer, another trade war might come up. Arguably, that is the last thing the world needs at this very moment.
Also Read: Palm Oil Industry: An Overview