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The Union government on Wednesday re-imposed a minimum export price of $650 a tonne on onions to check export. It also decided on a host of measures like stock-holding limits to check hoarding, import of onion from Pakistan through the National Agricultural Cooperative Marketing Federation of India (Nafed) and a possible regulation of export through release orders to check spiralling prices, which have threatened to touch Rs 100 a kg in the next few days.
The decision to curb onion exports and increase imports was taken at a high-level inter-ministerial meeting of representatives from the ministries of consumer affairs, agriculture, commerce and finance, among others. The government had lifted the minimum export price of onion more than a year before after prices stabilised in the domestic market.
Officials said the government was constantly monitoring the situation and would take all appropriate measures as and when needed.
The meeting was held against the backdrop of a sudden spurt in onion prices which rose by Rs 10-15 a kilogram in the last few days because of poor supplies. Earlier in the day, a high-level committee of secretaries, which included consumer affairs, commerce and agriculture among others too held a meeting to review the onion price situation.
On Tuesday, consumer affairs minister K V Thomas met with agriculture minister Sharad Pawar to discuss the situation. Officials said there seemed to be a consensus that exports of onions should not be banned at this juncture as the current price spike is a temporary phenomenon.
Onion prices in the retail markets have moved up by almost Rs 10-15 a kilogram in the last few days and are currently hovering around Rs 70-80 a kg, mainly due to disruption in supplies from Maharashtra and Karnataka due to heavy showers.
The two states together produce 80 per cent of the country's onion crop. India has exported 500,000 tonnes of onion in the first four months of the 2013-14 financial year.
In financial year 2012-13, India had exported two million tonnes of onion, out of a total production of 17 million tonnes.
Officials from the department of agriculture said the current spike in onion prices was a temporary phenomenon and hence, there should not be any outright ban on exports, which would hurt the interest of farmers in the long run.
According to the Press Trust of India, to cool prices in Delhi, where assembly elections are due in November, the government has asked Nafed to buy four-five tonnes of onions a day from Rajasthan to sell through its outlets and mobile vans. In other parts of the country, Nafed has been asked to procure onions at best prevailing rates from the mandis of Lasalgaon/Pimpalgaon in Nasik district in Maharashtra and offer them to state marketing and supply federations at a nominal service charge of two per cent.
