In order to increase availability and curb prices in the domestic market, the government on Monday banned the export of all varieties of onions with immediate effect. “The export of all varieties of onions… Is prohibited with immediate effect,” the Directorate General of Foreign Trade (DGFT) said in a notification.
Excessive rainfall in India’s southern states of Karnataka and Andhra Pradesh has damaged summer-sown crop and delayed harvesting in other states, said Ajit Shah, president of the Mumbai-based Onion Exporters’ Association.
It may be noted that 40% of the country’s total onion crop is produced in the Kharif season and the rest during the rabi season. The Kharif crop, however, cannot be stored.
Prices at Lasalgaon’s market in Nashik district started rising since early May. The recent appreciation of prices is mainly due to heavy August rain destroying the onion crop of north Karnataka, which was supposed to hit the market early September.
In a notification, the Ministry of Commerce and Industry stated, “In exercise of the power conferred by Section 3 of the Foreign Trade (Development and Regulation) Act, 1992, as amended, read with para 1.02 and 2.01 of the Foreign Trade Policy, 2015-20, the Central Government hereby makes the following amendment in the Export policy of the onions. For the item description at Serial Number 51 and 52 of Chapter 7 of Schedule 2 of ITC (HS) Classification of Export and Import Items, with immediate effect.”
India had last year banned the exports of the key kitchen staple in the wake of its rising prices in the country and set the minimum export price (MEP) of onion at $850 a tonne to curb its shipments and help bring down soaring prices in the domestic market due to floods in parts of major growing states of Maharashtra and Karnataka. The MEP was lifted in March this year and onions were made free for export.
