In twin measures to incentivize onion exports, India has scrapped the minimum export price (MEP) for the commodity with immediate effect and slashed duty on the kitchen staple’s overseas shipment from 40 to 20 per cent, Daily Sun reports.
The decisions announced on Friday night were aimed at enhancing farmers' income, ahead of forthcoming assembly elections in Maharashtra state, the largest producer of the kitchen staple, where ruling Bharatiya Janata Party (BJP) has high stakes.
The Directorate General of Foreign Trade (DGFT) announced the abolition of the MEP on onion with immediate effect.
In May this year, India withdrew the ban on onion exports but imposed a $550 per tonne as the minimum export price, which essentially meant farmers could not sell their produce overseas at lower than this rate.
"The Minimum Export Price (MEP) condition on export of onions is removed with immediate effect and until further orders," a DGFT notification said.
The decision to remove the MEP on onion has been taken despite high retail prices of this key kitchen item.
According to the data compiled by the Department of Consumer Affairs, the all-India average price of onion on Friday is Rs 50.83 per kg, while the modal price is Rs 50 per kg. The maximum price of onion is Rs 83 per kg and the lowest is Rs 28 per kg.
In a related measure, the Indian Finance Ministry on Friday night cut the duty on onion export to 20 per cent from 40 per cent.
The duty cut will be effective from Saturday (September 14).
The 40 per cent export duty had been in place since May 4 after it was introduced to discourage export of onion to help bring down its price in the domestic market.
India exported 2.6 lakh tonnes of onions till July of this fiscal. The country had exported 16.07 lakh tonnes of onions in the last fiscal.
bd-pratidin/GR
