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Malaysia's Mahathir rules out trade action over Indian palm oil boycott

Malaysia's Mahathir rules out trade action over Indian palm oil boycott

India was Malaysia's third-biggest market for palm oil and palm oil products in 2018 AFP/Mohd RASFAN

LANGKAWI: Malaysia will not take retaliatory trade action against India over its boycott of palm oil purchases amid a political row between the two countries, Prime Minister Mahathir Mohamad said on Monday (Jan 20).

READ: India asks refiners to stop buying Malaysian palm oil after political row: Sources

India, the world's largest edible oil buyer, this month effectively halted imports from its largest supplier and the world's second-biggest producer in response to comments from Mahathir attacking India's domestic policies.

"We are too small to take retaliatory action," Mahathir told reporters in Langkawi, a resort island off the western coast of Malaysia. "We have to find ways and means to overcome that," he added.

The 94-year-old premier of Muslim-majority Malaysia has criticised New Delhi's new religion-based citizenship law and also accused India of invading the disputed region of Kashmir.

Mahathir again criticised India's citizenship law on Monday, saying he believed it was "grossly unfair".

READ: Malaysian PM Mahathir defends criticism of India's citizenship law despite palm oil backlash

India has been Malaysia's largest palm oil market for the past five years, presenting the Southeast Asian country with a major challenge in finding new buyers for its palm oil.

Benchmark Malaysian palm futures fell nearly 10 per cent last week, their biggest weekly decline in more than 11 years.

READ: India's palm oil ban will spark price war with Indonesia: Malaysian industry association

New Delhi is also unhappy with Malaysia's refusal to revoke permanent resident status for controversial Indian Islamic preacher Zakir Naik, who has lived in Malaysia for about three years and faces charges of money laundering and hate speech in India.

Mahathir said even if the Indian government guarantees a fair trial, Naik faces the real threat of vigilante action and that Malaysia will only relocate the preacher if it can find a third country where he would be safe.

"If we can find a place for him, we will send him out."

Source: Reuters/aa


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