The government today slashed the minimum export price (MEP) of onions to USD 400 per tonne from USD 700 a tonne.
"On Onion -- decision taken today to reduce the Minimum Export Price (MEP) of onion from USD 700 tonne to USD 400 a tonne," Commerce Minister Nirmala Sitharaman tweeted.
MEP is the rate below which no traders are allowed to export. The rise in MEP restrict exports and improves domestic supply.
The Minister added that an Inter Ministerial Group (IMG) shall review the arrivals of the kitchen staple in mandis and their prices, every two weeks.
"Finance Minister Arun Jaitley chaired the meeting. It was also attended by Agriculture Minister Radha Mohan Singh and Sitharaman. Detailed periodic assessments will be kept up," she said.
In August, the government had hiked onion MEP to USD 700 per tonne, from USD 425, as prices at both wholesale and retail levels were skyrocketing on lower output due to unseasonal rains.
However, earlier this week Maharashtra government had asked the Centre to scrap the MEP for onions to help boost overseas shipments after wholesale prices of the bulb went down to the Rs 10 per kg level.
According to National Horticultural Research and Development Foundation (NHRDF) data, wholesale onion prices are ruling at Rs 10-14 per kg at Asia's biggest wholesale market for onion, Lasalgaon in Maharashtra, much lower than its peak Rs 57 per kg in August.
