India imposes 40% duty on onion exports as prices rise

Mangalore Today News Network / NDTV

New Delhi, Aug 19, 2023: The government has imposed 40 per cent duty on onion exports till December 31 this year, the Finance Ministry said.

The duty is applicable immediately, it said.

 

The move comes as onion prices continue to rise this month. Reports said onion prices are likely to keep rising in September.

Tomato prices, on an average, also registered a further increase in August so far, although more recent data indicate some pullback in rates, the Reserve Bank of India (RBI) said in its bulletin on Thursday.

Onion and potato prices also registered sequential increase, the bulletin said.

On August 11, the central government started releasing onion from its buffer stock, news agency ANI reported.

The government had decided it will maintain 3 lakh tonne of onions in the 2023-24 season as buffer stock. In 2022-23, the government maintained 2.51 lakh tonne onion as buffer stock.

Buffer stock is maintained to meet any exigencies and for price stabilisation, if rates go up significantly during the lean supply season.

Rohit Kumar Singh, Secretary Food and Public Distribution Department in a meeting on Thursday with the Managing Directors of the government’s agricultural marketing agencies -- National Agricultural Cooperative Marketing Federation of India (NAFED) and National Cooperative Consumers’ Federation of India Limited (NCCF) -- finalised the modalities for disposal.

"It was decided to release the onion stocks by targeting key markets in states or regions where retail prices are ruling above the all-India average and also where the rates of increase in prices over the previous month and year are above the threshold level. Disposal through e-auction and retail sales on e-commerce platforms are also being explored," a Food Ministry statement said Friday.

Rabi onion harvested during April-June accounts for 65 per cent of India’s onion production and meets the consumer’s demand till the kharif crop is harvested in October-November.

The procured stocks are usually released through targeted open market sales and also to states and Union Territories and government agencies for supplies through retail outlets during the lean supply season.