India may restrict imports of palm oil from Malaysia

India is considering restricting imports of some products from Malaysia including palm oil, according to government and industry sources, in reaction to the Southeast Asian country’s leader criticizing New Delhi for its actions in Kashmir.

India is looking for ways to limit palm oil imports and may place restrictions on other goods from the country, said a government source and an industry source who participated in discussions led by the Ministry of Commerce and Industry on the planned restrictions.

The sources asked not to be named as the proposal was still under discussion.

India’s government was angered after Malaysian Prime Minister Mahathir Mohamad said last month at the United Nations that India had “invaded and occupied” Jammu and Kashmir and asked New Delhi to work with Pakistan to resolve the issue.

Muslim-majority Kashmir is divided between India and Pakistan, which both claim it in full and have twice gone to war over the territory. India revoked the special constitutional status of its portion of Kashmir in August, angering Pakistan.

The government wants to send a strong signal of its displeasure to Malaysian authorities, the sources said. India, the world’s biggest importer of edible oils, is planning to substitute Malaysian palm oil with supplies of edible oils from countries such as Indonesia, Argentina and Ukraine, said the sources.

Palm oil accounts for nearly two-thirds of India’s total edible oil imports. India buys more than 9 million tonnes of palm oil annually, mainly from Indonesia and Malaysia.

In the first nine months of 2019 India was the biggest buyer of Malaysian palm oil, taking 3.9 million tonnes, according to data compiled by the Malaysian Palm Oil Board.

A spokeswoman for India’s commerce ministry said the ministry could not comment on things that were under consideration.

Malaysia’s prime minister on Friday said he had not received “anything official” from India, after Reuters first reported that India was mulling restricting imports of Malaysian palm oil and other products.