Export Duty: Centre puts 40% export duty on onions to boost supplies, tame prices

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NEW DELHI: The government on Saturday imposed a 40% export duty on onions in a move aimed at improving domestic supplies and avoiding any price rise during the upcoming festive season. The export duty will be valid till December 31, 2023.
The Centre has imposed the duty for the first time amid the trend of “exceptionally high export” during this year. In earlier moves, it had banned onion exports from September to December in 2020 and fixed a minimum export price in 2019.

The latest step comes after official data showed retail inflation, as measured by the consumer price index, soared to a 15-month high of 7.4% in July, up from the previous month’s 4.9%. PM Modi, in his I-Day speech, promised to control inflation and minimise the burden on citizens.
Officials said exports this year have been exceptionally high in the January-March period at around 8.2 lakh tonnes, compared with 3.8 lakh tonnes in the previous corresponding period.
In Jan-March, onion exports surged at 8.2L tonnes
In order to increase the availability of onions in the domestic market, especially in view of the upcoming festival season, the government has decided to impose a 40% duty on the export of onions, Union consumer affairs secretary Rohit Kumar Singh said on Saturday. “It was also being noticed that there was a sharp rise in exports in the recent past,” he added.
Officials said exports this year have been exceptionally high in the JanuaryMarch period at around 8.2 lakh tonnes, compared with 3.8 lakh tonnes in the previous corresponding period. Government data shows that average retail price of the kitchen staple has increased to Rs 30 per kg compared to Rs 25 a month ago, amid reports of sluggish kharif sowing due to delayed arrival of monsoon in the key onion-producing states of Maharashtra and Karnataka. Moreover, the high moisture content in the stored rabi crops because of unseasonal rains in April in Maharashtra and Karnataka has impacted the shelf-life of the produce. Sources said while estimated onion production is marginally less at 31 million tonnes (MTs) compared to 31.7 MTs last year, there are quality issues.
Meanwhile, the benchmark price at Lasalgaon in Maharashtra, which is Asia’s largest onion mandi, increased 50% to Rs 2,050 per quintal on Saturday, from Rs 1,370 a quintal on August 2.