NEW DELHI: Onion prices remain more or less stable around ₹40 per kilogram in the markets of Delhi. In August, wholesale and retail onion prices across the Indian level fell 34.5% and 4% respectively compared to last year’s level.
So why did the government hastily ban the export of onions when it has a stated policy to deregulate onions by amending the Essential Products Act for better realization of prices for farmers?
While domestic onion prices remain stable, it is the rebound in external demand for onions that appears to have triggered the ban on the export of onions. During the April-June period, onion exports to Bangladesh, India’s largest overseas market for the key cooking ingredient, soared 147.5% to 1.9 lakh metric tons. Overall, onion exports grew 23% over the same period to 6.8 lakh metric tons.
Bangladesh relies heavily on Indian onions to meet its domestic demand. On September 29 last year, when India banned the export of onions, onion prices skyrocketed in Bangladesh and became a point of friction between the two neighboring countries. Learning from its experience and anticipating a ban on onion exports this year as well, Bangladesh appears to have increased its import of onions from India to restock its cold stores.
During her visit to India in October last year after the ban on the export of onions, Prime Minister of Bangladesh Sheikh Hasina said “Pyaaz leke thoda sa dikkat ho gaya hamare liye. Mujhe maloom nahin hain, aapne kyun pyaaz band kardiya. Thoda notice dene is shortened hota hum dusre desh se la sakte the. Achanak band kardiya aur ye hamare liye mushqil ban gaya. (We faced some problems due to the ban on onion exports from India. I don’t know why you banned the export of onions. It would have been better if you had alerted us in advance so we could get onions from other countries. You banned it from Suddenly and it became a problem for us. ”Hasina had jokingly said that she had asked her cook not to use onions in the kitchen.
The restriction on onion exports has become an annual affair. Last year, the government imposed stock limits across the country to lower onion prices that had soared ahead of state elections in Maharashtra and Haryana. The upcoming state elections this year in Bihar and Madhya Pradesh may also have played a role in the export ban.
The crackdown followed retail onion prices ₹80 kg in Delhi due to supply disruptions after floods in some states. In December, prices hit ₹160 per kg in certain parts of the country. Five months after the ban, the government lifted the restrictions as of March 15, as the shortage in onion supply due to excess rain and floods that hit the kharif crop passed with the arrival of the onion crop. rabbi.
Indian farmers deserve a stable agricultural export policy for better price predictability.
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