Thursday, Sep 29, 2022

The dangers of India’s palm oil push

Sudhir Kumar Suthar writes: Apart from ecological impact, incentivising palm oil cultivation could have negative implications on farmer incomes, health, and food security in the long run

Palm oil plantations have stoked conflict between government policies and customary land rights.

On August 15, Prime Minister Narendra Modi announced a support of Rs 11,000 crore to incentivise oil palm production. The government intends to bring an additional 6.5 lakh hectares under oil palm cultivation. The agro-business industry has said the move will help its growth and reduce the country’s dependence on palm oil imports, especially from Indonesia and Malaysia. India imported 18.41 million tonnes of vegetable oil in 2018.

The National Mission on Oilseeds and Oil Palm are part of the government’s efforts to reduce the dependence on vegetable oil production. The Yellow Revolution of the 1990s led to a rise in oilseeds production. Though there has been a continuous increase in the production of diverse oilseeds — groundnut, rapeseed and mustard, soybean — that has not matched the increasing demand. Most of these oilseeds are grown in rain-fed agriculture areas of Gujarat, Andhra Pradesh, Haryana, Karnataka, Rajasthan, Madhya Pradesh, Tamil Nadu and Uttar Pradesh.

A significant incentive for the launch of the National Mission on Edible Oils and Oil Palm (NMEO-OP) to promote palm cultivation comes from the “success stories” of the two Southeast Asian countries, Indonesia and Malaysia. Indonesia has emerged as a significant palm oil hub in the last decade and has overtaken Malaysia. The two countries produce 80 per cent of global oil palm. Indonesia exports more than 80 per cent of its production.

However, a careful analysis of the policy initiative that can potentially change the rural and agrarian landscape of the Northeast and Andaman Islands needs to be undertaken. Oil palm cultivation can have disastrous environmental and social consequences. Studies on agrarian change in Southeast Asia have shown that increasing oil palm plantations is a major reason for the region’s declining biodiversity. Indonesia has seen a loss of 1,15,495 hectares of forest cover in 2020, mainly to oil palm plantation. From 2002-18, Indonesia lost 91,54,000 hectares of its primary forest cover. Along with adversely impacting the country’s biodiversity, it has led to increasing water pollution. The decreasing forest cover has significant implications with respect to increasing carbon emission levels and contributing to climate change.

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Palm oil plantations have stoked conflict between government policies and customary land rights. Such rights are major livelihood sources for forest-dependent communities. Legislation allowing the clearing of tree cover and cutting forests for growing palm trees has led to increasing land-related tussles between government officials, locals and agro-business groups in Malaysia and Indonesia. The Northeastern states are politically sensitive areas, and the oil palm initiative could breed tension there.

Such initiatives are also against the notion of community self-reliance: The initial state support for such a crop results in a major and quick shift in the existing cropping pattern that are not always in sync with the agro-ecological conditions and food requirements of the region. During a brief field study in 2020 to understand the impact of agriculture policies, an official associated with the department of agriculture informed me about the Arunachal government’s changing policy on using forestland for palm oil plantations. The official said that the policy has begun impacting the forest cover as farmers, armed with government incentives, are switching from traditional crops like rice and maize to palm oil. She pointed out that people in the Northeast do not use the oil for cooking or any other purpose. The oil is being used by industries for packaged food and medicines, detergents and cosmetics, the official said.

The current initiative ignores such ground-level realities. The Northeast is recognised as the home of around 850 bird species. The region is home to citrus fruits, it is rich in medicinal plants and harbours rare plants and herbs. Above all, it has 51 types of forests. Studies conducted by the government have also highlighted the Northeast’s rich biodiversity. The palm oil policy could destroy this richness of the region.


The policy also contradicts the government’s commitments under the National Mission for Sustainable Agriculture: “Making agriculture more productive, sustainable, remunerative and climate resilient by promoting location specific integrated/composite farming systems.” The palm oil mission, instead, aims at achieving complete transformation of the farming system of Northeast India.

Palm oil cultivation has had a positive impact on poverty eradication in Malaysia, increasing income levels of small and marginal farmers. However, studies also show that in case of variations in global palm oil prices, households dependent on palm oil cultivation become vulnerable – they manage to sustain themselves with help of proactive state intervention. A sizable number of small landholders continues to depend upon other sources of income. In other words, such an agricultural shift is not self-sustaining and makes local communities vulnerable and exposes them to external factors.

To preserve the environment and biodiversity, Indonesia and Sri Lanka have already started putting restrictions on palm tree plantation. In 2018, the Indonesian government came up with a three-year moratorium on new licenses to produce palm oil. Recently, the Sri Lankan government has ordered the uprooting of oil palm plants in a phased manner.


Similar environmental and political outcomes cannot be ruled out in India. Many state governments have started encouraging palm oil production despite traditional oilseeds being used by families for daily consumption. The increasing focus on palm oil will gradually result in focus shifting away from rainfed oilseeds. Apart from the possible hazardous impacts in Northeast India, such trends could have negative implications on farmer incomes, health, and food security in other parts of the country in the long run.

This column first appeared in the print edition on August 26, 2021 under the title ‘Slipping on palm oil’. The writer is assistant professor, Centre for Political Studies, JNU

First published on: 26-08-2021 at 04:00:35 am
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