Government lifts ban on onion export, minimum export price $550 per tonne

New Delhi. Amid the ongoing Lok Sabha elections in the country, the government on Saturday lifted the ban on onion export, but also fixed the minimum export price (MEP) at $ 550 per tonne. This decision may help in increasing the income of a large section of farmers in major producing areas including Maharashtra. The government has imposed a minimum export price (MEP) of $550 per tonne (about Rs 46 per kg) plus 40 per cent export duty. Taking into account the duty, export consignments will not be allowed to be shipped below $770 per tonne (about Rs 64 per kg).

The Center had on December 8 last year banned onion exports to control retail prices amid concerns over decline in production. During the last 4-5 years, 17 lakh to 25 lakh tonnes of onion was exported from the country annually. Consumer Affairs Secretary Nidhi Khare said there will be no increase in prices in retail markets due to the lifting of the ban. “Prices will remain stable,” he said. If there is any increase, it should be very nominal.” He said the government is committed to protecting the interests of both consumers and farmers.

The export policy of onion has been revised with immediate effect and till further orders, the Directorate General of Foreign Trade (DGFT) said in a notification that onion has been exempted from the restriction under MEP of $550 per tonne. The government had last night imposed 40 percent duty on onion exports. The decision is significant as it comes ahead of the crucial Lok Sabha elections in key onion regions of Maharashtra like Nashik, Ahmednagar and Solapur. Farmers of this area were demanding removal of the ban, so that they could get better prices for their produce.

Explaining the rationale behind the decision, Khare said, “The ban on onion exports has been lifted from today (Saturday) as the supply situation is comfortable and prices are stable in the mandis as well as in the retail markets.” The model price of onion in Nashik’s Lasalgaon mandi was Rs 15 per kg. He said that this decision has been taken after considering the latest estimate of onion production of 191 lakh tonnes in Rabi season. While taking this decision, the availability and prices of onion in the global markets were also kept in mind. The Secretary said that the monthly domestic demand of onion is about 17 lakh tonnes.

Khare said, “With the lifting of the ban, farmers will be encouraged to cultivate onion in more area. The monsoon forecast is expected to be better than normal. The Secretary said that this decision has been taken after extensive discussions with all the stakeholders. A high level team also visited major onion growing areas in Maharashtra to assess the ground situation. The Secretary said that the government is purchasing five lakh tonnes of onion as buffer stock, so that it can intervene in the market in case the prices rise.

He said, “We are constantly monitoring the prices of all essential food items. We will continue to monitor the availability and price situation.” A senior government official said there is an inter-ministerial committee (IMC), which reviews prices, production, availability and exports of essential food items, including onion. The official said the IMC is taking several steps for various commodities, including wheat and rice, to boost domestic supplies and keep prices under control.

Disclaimer: CricketInFocus has not edited this news. This news has been published from PTI-language feed.

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