Nafed proposed as lone channel for onion export

The Union agriculture ministry has sent a proposal to the commerce ministry for appointing National Agriculture Co-operative Marketing Federation (Nafed) as the single channel agency for controlling onion exports.

If the commerce ministry gives its approval, it will help Nafed to control onion prices by exporting in case of oversupply. Nafed has also urged the agriculture ministry to give local transport subsidy (LTS) for intra-country transportation of onion.

C B Holkar, president, Nafed, said, "The Union government had appointed Nafed as a single channel agency to export onion in 1975. Following this, Nafed had chalked out export guidelines for promoting its exports.

Accordingly, exporters had to fix the minimum export price (MEP) and they were not allowed to export onion below MEP. Nafed issued no objection certificates (NOCs) to exporters after the receipt of letter of credit (LC) from foreign importers following order booking. Hence, exporters received payments on time. But, LC conditions were relaxed once the NDA-led government came to power. The new government appointed 13 channel agencies, including Nafed. As a result, Nafed lost its control over the other agencies.''

''It was shocking that 80 per cent of the agencies, which had no export background, were appointed as channel agencies. Today, free documents are sent to foreign importers. Hence, exporters are not getting their payments on time. Till date, many exporters have still not received their payments. As a result, many onion exporters are slowly switching to other businesses. During April-November last fiscal (2004-05), 6.50 lakh metric tonne (mt) of onion was exported. But by November end in the current fiscal (2005-06), the export has come down by 2.25 lakh mt," Holkar said.

He said the federation has met Union Agriculture Minister Sharad Pawar and proposed to appoint Nafed as the lone channel agency throughout the country.