India, Indonesia Sign Palm Oil Pact To Boost Food Security

To strengthen economic ties and guarantee food security, the Indonesian Palm Oil Association (IPOA) and the Indian Vegetable Oil Producers Association (IVPA) on Thursday inked a three-year agreement. Since palm oil is the foundation of the edible oil trade between the two countries, the memorandum of understanding seeks to improve cooperation in this area.

Over 60 per cent of India’s edible oil needs are imported, and Indonesia has been the country’s main supplier of palm oil for over ten years, according to the industry association SEA India. Five main areas are the focus of this formal agreement, which aims to strengthen the relationship: market intelligence sharing, policy coordination, adoption of sustainability initiatives, technical exchange and research and development, and measures to support food security.

In keeping with the growing focus on responsible agriculture, both nations have emphasised the necessity of promoting certified sustainable palm oil and expanding smallholder farmers’ involvement in the larger supply chain.

In 2024, India and Indonesia’s trade totalled USD 26 billion, of which USD 4 billion was primarily made up of palm oil and its derivatives. With 58 per cent of global exports, Indonesia is the world’s largest exporter of palm oil, and its palm oil industry occupies over 16 million hectares or 7.4 per cent of the nation’s total land area.

To ensure broad economic participation, the industry is owned by a combination of state enterprises, smallholders and private companies.

Important government organisations such as the Indonesian Ministry of Trade and the Indian Ministry of Commerce and Industry will work closely together on the new agreement. With initiatives like ISPO certification and forest conservation, it backs Indonesia’s and India’s National Edible Oil Mission to decarbonise exports and raise sustainability standards.

A bilateral working group will oversee the pact’s implementation and be responsible for publishing yearly progress reports and making sure both nations’ interests are adequately represented on global platform.

“Today’s MoU signals our shared commitment to a future-ready, transparent palm oil supply chain that benefits consumers and producers alike.” M Fadhil Hasan, Head of Foreign Affairs, IPOA, emphasised Indonesia’s support for India’s food security and climate goals, remarking, “We look forward to advancing India’s food security and climate goals through a reliable, responsibly sourced palm oil supply,” said  Sudhakar Desai, President, IVPA.

Tags: Indonesian Palm Oil Association, cooperation, Indian Vegetable Oil Producers Association, export, Indonesia, India, palm oil, edible oil, food security