Almost ten months after it prohibited onion exports, the Union government on Friday (September 13, 2024) scrapped the minimum export price (MEP) mandate of $550 per metric tonne imposed on such shipments in May. The change in stance comes ahead of Assembly elections in Maharashtra, the country’s largest onion producer.

The government had banned the export of the politically sensitive kitchen stable last December, fearing domestic shortages after a weak monsoon. In March, the ban was extended till further orders, even as some shipments were allowed based on diplomatic requests from some countries.

Poll impact

Onion farmers had turned restive as these extended curbs coincided with high global prices and demand. In May, ahead of the Lok Sabha election in Maharashtra’s onion farming hubs, onion exports were moved back from the ‘prohibited’ to ‘free’ category, albeit with the conditions of a 40% export duty and an MEP of $550 per tonne. While the MEP has been dropped, the export duty had not been altered till the time of going to press.

Editorial:A sob story: On onion exports 

A similar MEP imposed on basmati rice exports last October, of $950 per tonne, was also scrapped through a separate order issued on Friday by the Department of Commerce. However, the order mandates the Agricultural and Processed Food Products Export Development Authority (APEDA) to closely monitor export contracts “for any non-realistic prices” in the case of basmati rice exports.

Meanwhile, another December 2023 decision aimed at checking inflation — to permit duty-free imports of yellow peas with no conditions attached — has been extended for the fourth time from its current October 31 sunset date, till December 31, 2024. This may have been driven by the latest Consumer Price Index (CPI) data for August, with pulse inflation coming in at 13.6%, well above the 10% mark for the 15th month in a row.