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India makes exemption for Nepal, allows some refined palmolein imports- sources

Rajendra Jadhav and Subrata Nagchoudhury

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MUMBAI/KOLKATA, Feb 12 (Reuters) - India, which restricted imports of refined palm oil and palmolein in January, has exempted Nepal and has started issuing licenses to import some refined palmolein from the Himalayan nation, two government officials told Reuters.

The move could put pressure on Indian refiners as imports from Nepal were allowed at zero duty under a regional treaty. It will also help Nepal, as refined palm oil and palmolein are its largest export earners.

The initiative may also help India counter the growing influence of China in Nepal, where Chinese investments have been climbing.

Licenses to import around 88,000 tonnes of refined bleached deodorized palmolein from Nepal were issued to about half a dozen importers, said a Kolkata-based official at India's Directorate General of Foreign Trade (DGFT).

India had restricted imports of refined palm oil and palmolein in January, a move that targeted top supplier Malaysia, which had criticized New Delhi's new citizenship law and its policies in Kashmir, but which also hurt Nepal.

Kathmandu has been urging New Delhi to allow imports of refined palm oil and palmolein.

"We have made an exception with Nepal. Refined palm oil imports are not allowed from any other country," said another DGFT official.

(Reporting by Rajendra Jadhav and Subrata Nagchoudhury; Editing by Edmund Blair)