The government is likely to take a decision in the next few days on the proposal to lift ban on exports of onion and wheat in view of their bumper production.
The empowered group of ministers (EGoM) on food, headed by Finance Minister Paranab Mukherjee, is expected to meet "sometime this week", said a source.
While the Agriculture Ministry is pushing for lifting of the export ban, Commerce and Finance Ministries are being cautious in view of the experience of past few months that has seen food inflation soar to over 17%. It fell to about 13%, as of January end, but is still considered high for comfort.
"There are number of issues (to be discussed by the EGoM this week). There is something on pulses which will be coming up, something on vegetable oil and also on wheat and onion," the source said.
Last Wednesday, hundreds of farmers in Nashik took to the streets and blocked the busy Mumbai-Agra highway to protest against the fall in onion prices after ban on exports.
Maharashtra Chief Minister Prithviraj Chavan too has demanded that ban on exports of onion, which has seen a crash in prices, be lifted completely.
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Onion prices, which had touched Rs 85 per kg at the retail level (Rs 60-70 per kg in wholesale), have fallen to as low as Rs 4-5 a kg in the mandis of Maharashtra. It is now selling at Rs 20-25 a kg in retail.
Agriculture Minister Sharad Pawar has pointed out that onion production will be less this year compared to last year, but still the output would be sufficient to meet the country's requirement.
Last week, the EGoM allowed exports of two varieties of onion. It also permitted shipments of three varieties of non-basmati rice, with a cap of 1.5 lakh tonnes.
Demand for lifting export ban on wheat is also gaining ground on account of bumper production of the grain. India's wheat production is estimated to touch an all-time high of 81.47 million tonnes in 2010-11 crop year.
The government banned wheat exports in early 2007 to boost domestic availability and control inflation.
On vegetable oil, the EGoM could consider reducing the import duty of refined edible oil as the prices of coking oils have risen by about 25% in the last 6-9 months. At present the import duty is 7.5%. Crude edible oil attracts zero duty.