The decision to end fixing a benchmark price below which onion could not be exported was taken at a meeting chaired by Prime Minister Manmohan Singh, official sources said. It is expected to boost income of farmers, who did not get high remunerative price despite handsome production in 2011-12.
To ensure that domestic markets remain unaffected by this step, it was also decided that the situation would be reviewed after every two months.
The meeting was called after Agriculture Minister Sharad Pawar wrote to Singh raising objections to export policies of agriculture commodities such as sugar, cotton, onion and dairy products.
Besides Pawar, Finance Minister Pranab Mukherjee,Commerce and Textiles Ministers Anand Sharma and Food Minister K V Thomas also attended the meeting.
Due to high export price of onions, India had lost its competitive edge in international onion markets to China and Egypt.
Earlier in January this year, the government had lowered minimum export price (MEP) of all varieties of onions, except Bangalore Rose onions and Krishnapuram onions to USD 150 per tonne.
India's onion production is estimated at 151.36 lakh tonnes in 2011-12 (July-June), which is higher than the previous year's output of 145.62 lakh tonnes.
Maharashtra and Gujarat are the main producing regions of the kitchen staple. PTI LUX SNS MJH NS
YB
