India has raised import tax on crude palm oil to 44 percent from 37.5 percent, a government notification said on Saturday, as the world's biggest palm oil importer tries to boost local oil seed production.

The hike in import duty on palm oil could prompt buyers to increase purchases of rival edible oils such as soyoil and sunflower oil, traders said.

India has been locked in a tussle with Malaysia, one of the largest palm oil suppliers in the world after Malaysian prime minister Mahathir Muhammad's comments criticising New Delhi over its policy on Kashmir.

India, the world's largest edible oil buyer, last month halted Malaysian palm oil imports after Mahathir's comments.