KUALA LUMPUR, Oct 29 (Reuters) - Malaysia plans to relax restrictions on the entry of migrant workers in the second half of 2022 in order to ease a pandemic-induced labour crunch and boost output in the palm oil sector, a government report said on Friday. Output in the world’s second largest producer of the ubiquitous vegetable is expected to fall to multi-year lows in 2021 after border restrictions designed to curb the coronavirus outbreak halted the entry of workers from countries like Indonesia, India and Bangladesh. The sector is expected to rebound next year, however, in anticipation of the improved production of palm fruit bunches and a better oil extraction rate, according to the government’s 2022 economic outlook report, which was released ahead of Malaysia’s budget announcement on Friday. “The continuation of the national B20 biodiesel programme for the transportation segment, along with higher demand of crude palm oil from India and China, are expected to further support the production of crude palm oil,” the report said. Malaysia is reliant on around 330,000 documented migrant workers to turn its abundant palm oil into everything from ramen to chocolates and lipstick. (Reporting by Mei Mei Chu; Editing by James Pearson)