New Delhi: The government on Sunday banned exports and imposed countrywide stock limits on onion with immediate effect to bring down prices of the key cooking ingredient that have soared ahead of state elections in Maharashtra and Haryana.
The crackdown follows retail onion prices touching ₹80 a kg in Delhi due to supply disruptions after floods in some states. A similar price trend prevails in other parts of the country.
Acting swiftly on a letter from consumer affairs secretary A.K. Srivastava earlier on Sunday to director general of foreign trade Alok Chaturvedi, the commerce ministry notified a ban on onion exports. Srivastava had written that even after imposing a minimum export price of $850 per tonne on 13 September, export of onions continues unabated. “With a view to improve domestic availability and control prices, may I request you to consider banning export of onions immediately," Srivastava wrote.
“The reported export below minimum export price to Bangladesh and Sri Lanka will be immediately stopped and strict action will be initiated against those who are found to be violating this decision of the government," a government official said on condition of anonymity.
India’s onion exports fell 10.7% to $154.5 million in April-July from a year ago. Malaysia, Bangladesh, Sri Lanka and the United Arab Emirates were the top importers of onion from India during this period.
Alongside, the consumer affairs ministry imposed stock limits on onion traders to facilitate release of stocks in the market and prevent hoarding. For retail traders, the stock limit is 100 quintals and for wholesale traders, it is 500 quintals.
“Till now, the state governments have been implementing the stock limit as per circumstances. For the first time, the Centre has simultaneously imposed stock limits across the country. At the same time, state governments have been directed to take strict action against hoarders. Soon, onion prices will come down in the market," tweeted food and consumer affairs minister Ram Vilas Paswan.
Food and trade policy analyst Devinder Sharma wondered why the government did not show such alacrity when onion prices crashed to ₹1-2 per kg, forcing farmers to discard their produce.
“What happens to the government then? Is government’s concern only confined to the consumers and not producers? This ad hocism in import-export policy is killing our agriculture," he added.