India’s palm oil ban: Dr M’s tirade is causing economic woes to the nation

India’s palm oil ban: Dr M’s tirade is causing economic woes to the nation

Looking to flex its trade muscles, India yesterday had imposed what amounted to an effective ban on refined palm oil from Malaysia following an ongoing diplomatic row between the two countries.

India’s Ministry of Commerce and Industry issued a notification yesterday noting that the import policy for refined bleached deodorised palm oil and refined bleached deodorised palmolein has been amended from ‘Free’ to ‘Restricted’ the clearest indication thus far of its decision.

The Indian government, led by Prime Minister Narendra Modi, is reviewing its economic engagement with Malaysia in retaliation to Kuala Lumpur’s attempt to meddle in its domestic issues, mainly Kashmir and the Citizenship (Amendment) Act 2019 issues.

Last year, Malaysian Prime Minister Tun Dr Mahathir Mohamad accused India of ‘invading and occupying’ Kashmir when Modi scrapped Article 370 of its Constitution, which allowed its side of Kashmir to enjoy certain privileges.

Unrelenting, Mahathir again criticised India for enacting the Citizenship Amendment Act, by falsely claiming that it would affect the citizenship of local Muslims in the country.

All this is on top of Malaysia’s decision not to repatriate fugitive Islamic preacher, Dr Zakir Naik back to India on money laundering charges despite having a bilateral extradition treaty.

Food for thought! India, the world’s largest vegetable oil importer, relies on Indonesia and Malaysia for its palm oil supply. Malaysia exported refined palm oil worth US$1.65 billion (RM6.9 billion) to India in 2018.

Palm oil export contributes to about 2.8% of Malaysia’s gross domestic product and 4.5% of our nation’s total exports.

In other words, India’s ban on our palm oil would have adverse effect on our economy, especially our Felda settlers who rely on palm oil for their livelihood.

Malaysia’s foreign policy seems to be volatile under Mahathir. While he was once respected as an outspoken third world leader during his first tenure as premier, Mahathir does not seem to understand that it no longer the 80s and the 90s anymore.

While Western powers of the past, Mahathir’s favourite boogeyman, used to ignore the old maverick’s temper tantrums, things are no longer the same these days.

Major powers these days are no longer that forgiving to criticism, especially when it is done without facts and figures.

Mahathir, by now, should have learned his lesson after his diplomatic gaffe with China. When he came to power in 2018, he tried to undo a lot of China’s projects in Malaysia, signed by his predecessor.

However, the premier had to backtrack on his decisions after an official visit to the world’s second largest economy. No one is sure what transpired in the meeting between him and Chinese President Xi Jinping.

But one thing we know is that Mahathir does not even dare to squeak about the sufferings of the Uyghur community in China.

At the time of writing, we have yet to see an official high-level reaction from either governments. In terms of economic impact on both nations, only time will tell.

The fact is, both the Indian and Malaysian economies are not doing well. But in comparison, Malaysia is a smaller economy. This important fact has been drummed by former prime minister Datuk Seri Najib Tun Razak many times whenever Mahathir launched his assault on India.

The question now is, how is our palm oil champion Primary Industries Minister Teresa Kok going to deal with this monumental mess? And please do not tell us Malaysians to consume a bucket of palm oil daily from now on.

Hema Subramaniam is Editor in Chief at The Leaders Online