India is considering to tax vegetable oil imports to protect the domestic industry from a slump in prices and lift a ban on exports, the farm minister said on Wednesday.

Sharad Pawar also said the government would consider scrapping an export tax of 8,000 rupees ($162.3) per tonne on basmati rice next month.

Global edible oil prices have fallen and have created problems for producers here. We will soon decide on imposing duty on imports, Pawar told reporters.

Inflation-weary India dropped a 20 percent import tax on crude edible oils in April and cut the levy on refined oils to 7.5 percent from 20.75 percent to combat rising prices.

The government had also banned exports of non-basmati rice in April and slapped a tax on overseas sales of premium basmati rice to help check rising prices at home.

India, the worlds biggest vegetable oil importer after China, buys almost half of its annual edible oil requirement of around 11 million tonnes mainly palm oil from Malaysia and Indonesia, and soyoil from Brazil and Argentina.

The Solvent Extractors Association of India (SEA), an apex body of vegetable oil traders, has asked the government to impose a 30 percent import duty on crude palm oil, 37.5 percent on RBD palmolein and 20 percent on crude soybean oil. The SEA has also requested farm, trade and finance ministries to allow vegetable oil exports, which were banned in March for a year barring tiny sales of groundnut oils.

Benchmark Malaysian crude palm oil futures fell more than five percent on Wednesday to their lowest since October 2006 amid a general sell off in commodities, led by sliding crude oil prices which were down 3.8 percent at $69.3 per barrel at 0950 GMT. Pawar said the government would consider reimposing import tax on vegetable oils, allow exports and scrap export tax on basmati rice after Diwali, or the festival of lights, Oct 28.

All these issues will be considered after Diwali, but removing ban on export of non-basmati rice is not under consideration, he said. The assurances of the minister would help the industry, hit by a sharp drop in vegetable oil prices, said B.V. Mehta, executive director of the SEA. reuters