Econintersect: India and Malaysia have signed a new trade pact that will phase in a number of tariff reductions over the next seven years. The objective is to reduce tariffs on a number of items to 5% maximum by 2016 and to maxima between 5% and 20% before then. One of the major tariffs addressed will be reduced as well, but to a level much above even 20%: refined palm oil tariffs will be reduced by India to a maximum of 45% by the end of 2018.
Refined palm oil is a widely used cooking oil in the Far East and is subject to periodic shortages due to both production shortfalls and distribution inefficiencies. For example, there appear to be distribution and hoarding problems for palm oil in Thailand, according to the Bangkok Post. The Post describes various possible contributions to the Thailand crisis, including price controls, price manipulation and under the table payments to corrupt officials, in addition to a shortfall in production of domestic crude palm oil.
A summary of the new trade agreement from The Times of India: