An export duty of 40% has been imposed on onions by the Central government until the end of 2023 to maintain the prices of the essential vegetables amidst the extensive increase in the issues relating to the supply of vegetables.
On August 14, the data released by India’s headline showed the inflation rate that hit retail over a year and increased by 7.44% in the month of July, which was encouraged by the huge rise in the tomato prices. Experts made a statement that the prices of onions will rise similarly to tomatoes now, but not to the same extent.
Earlier, the Moneycontrol had reported that the onion prices in major markets all over the country had increased twice the prices of tomatoes in some of the places such as Pimpalgaon of Maharashtra and Agriculture Market Committee of Lasalgaon, the largest onion markets in Asia. The experts said that the prices of onions have hiked due to the speculative buying behavior which was followed by the reduced land area of onions which got depleted in the monsoon and the rabi stocks was carried forward.
While the prices for the key vegetables like tomatoes and onions have increased rapidly, the people started buying other food items like pulses,cereals and milk in larger quantities. The government has however taken the necessary steps to maintain the consistency in the prices of key vegetables by prohibiting the export of non-basmati white rice from other countries.
The government made an announcement on 18th August 2023 that it will release the onions from its buffer stock in some targeted regions with an immediate effect, to make sure that the prices of the onions will remain under the check until the new crops arrive from the October month.
E-auction, E-commerce and multiple other options like buying through the states at the discounted prices via retail outlets of cooperatives and corporations of the consumers were being explored by the government for the disposal of onions. About 3 lakh tonnes of onion has been currently maintained under the (PSF) Price Stabilisation Fund to meet the demands, if the rates hike during the low supply season of key vegetables.
According to government data, the onion rates have begun to rise slightly and the retail price for this essential kitchen item nationwide was Rs 27.90 per kilogram on 10th August 2023, marking an increase of over Rs 2 per kilogram when compared to the price of onion in the same period in the last year. The Rabi onion crop which was harvested during April and June contributes around 65% of total onion production of India to fulfill the consumer needs until the kharif crop is gathered between the month of October and November.
