Government’s Major Decision on Onion Exports: Minimum Export Price Requirement Removed
14 September 2024, New Delhi: The Modi government has made a significant decision regarding the export of onions, offering relief to both onion farmers and exporters.
According to reports, the government has removed the Minimum Export Price (MEP) requirement of $550 per metric ton. This means onions can now be exported from India at any price. Additionally, the 40% export duty has been reduced to 20%. This move is being linked to the upcoming Maharashtra Assembly elections, as the issue of onion pricing had previously caused setbacks for the BJP and its allies during the Lok Sabha elections. Recently, a decision by the Ministry of Consumer Affairs also triggered discontent among onion farmers, and the government seems to have taken this step to address their grievances. The MEP imposed on onions and basmati rice had led to widespread anger among farmers and exporters.
While onions are a major crop in Maharashtra, basmati rice is a key crop in Haryana. Haryana’s assembly elections are approaching, and the announcement for Maharashtra’s elections is expected soon. It is believed that the government swiftly announced the removal of MEP for both products in response to these political timelines. Along with onions, the central government has also made a similar decision regarding basmati rice. The MEP of $850 per ton on basmati rice has also been lifted, as confirmed by Ashok Sethi, Director of the Punjab Rice Millers and Exporters Association. An official order from the government has confirmed these decisions, which are seen as being closely tied to the Haryana Assembly elections, where falling basmati prices have become a major issue.
When Were Export Duty and MEP Imposed?
In August 2023, the central government introduced a 40% export duty on onions to reduce domestic prices, which faced strong opposition across Maharashtra. Farmers and traders jointly closed several markets in the state, including Nashik, for several days. The $550 per ton MEP requirement was imposed on May 4, 2023, after the government lifted the export ban that had been in place during the Lok Sabha elections.
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