New Delhi, Mar 20: The government is understood to have decided to slash import duties on edible oils to make them cheaper in the domestic market, as it seeks to moderate inflation, which stood at 11-month high of 5.92 per cent for the week ended March 8.

In the wake of over 30 per cent increase in the retail prices of majority of cooking oils, the government may cut effective duties on palm oil to bring them down to 10 per cent, a senior official said here.

There may also be a similar cut on imported soyabean oil.

"The decision has been taken and the notification on the duty cuts can come any day," the official said.

At present, the government levies customs duties at 45 per cent on palm oil and 40 per cent on soyabean oil. However, due to retention of the base price at July 2006 level, the effective duty rates on imported edible oils are lower than the official ones.

"Prices have gone up and the duty cut is basically designed to moderate inflation. There will be cut in duties on a number of items, all sorts of edible oil to maintain the price," he said.

The government has recently banned the export of edible oils as it did not want to take any chances on the domestic availability.

Commerce and Industry Minister Kamal Nath had yesterday said the government was considering duty cuts on imports of palm oil.

The government is faced with an uncomfortable situation of rising prices of essential commodities.

"Palm oil duties are based on the international prices. If international prices rise, one does look at it to consider duty cuts to keep domestic prices all right," Nath had said.