Government Bans Onion Export As Prices Jump To Four-Year High

Amid the spiralling onion prices due to supply shortage, the Narendra Modi government at Centre on Sunday amended the export policy of the vegetable from free to prohibited till further notice. Therefore, the export of all varieties of onions will remain banned all over the world with effect from today, September 29, and until further orders.

"Export policy of Onion is amended from free to prohibited till further orders. Hence, export of all varieties of onions is prohibited with immediate effect," the Union Ministry of Commerce and Industry said in a statement.

Centre prohibits export of all varieties of #onions with immediate effect.

— Sitanshu Kar (@DG_PIB) September 29, 2019

Onion prices are on the rise despite several measures taken by the Central and state governments to boost supply. Retail prices have skyrocketed to Rs 60-80 per kg in Delhi and some other parts of the country due to supply disruption from flood-affected growing states like Maharasthra in the last few months. There is also a likely fall in this year's kharif production owing to less planted area under onion on account of excess rains.

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Right now, stored onions are sold in most parts of the country as fresh kharif (summer) crop will hit the market from November onwards, according to traders. Traders further said that there is enough supply of stored onion of the previous year's crop in the country but its transportation has been affected because of heavy rains.

Much of the onion is stored in Maharashtra, where rains disrupted the transport of the kitchen staple to other parts of the country. At Lasalgoan in Maharashtra, Asia's largest onion market, onion prices rose to Rs 45/kg last week, when compared with less than Rs 10/kg in the year-ago period.

In the wake of this massive price hike, Chief Minister Arvind Kejriwal on Saturday flagged off 70 mobile vans which will be selling onions at Rs 23.90 per kilogram to give relief to netizens across the city.

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There are also reports that the state-owned Mother Dairy has so far sold 5,000 tonnes onion at the subsidised price in the national capital and plans to further boost the supply to ensure consumers do no stand in long queues to buy the cheaper produce.

The Central government is also offloading 50,000 tonnes of buffer stock of onion across the country. Mother Dairy and cooperatives Nafed and NCCF are selling this stock in Delhi at a subsidised rate.