Partial Relaxation of Onion Export Ban
Context:
The Union government has partially relaxed the indefinite ban on onion exports, allowing for the immediate export of 2,000 tonnes of white onions from Gujarat.
Relevance:
GS-03 (Economy)
Key Highlights:
- Export of white onions will be permitted only after certification by Gujarat’s Horticulture Commissioner regarding the item and quantity being exported.
- Unlike previous relaxations, the latest notification does not specify destination countries or mandate exports through a particular agency. It only requires exports to be routed through designated ports in Gujarat or Mumbai.
- The relaxation has raised concerns among onion farmers from neighboring states like Maharashtra, who grow red onions, questioning why similar export opportunities are not provided for them.
- There are calls for further relaxations, with demands to open exports to all traders and farmers, including red onions and smaller-sized onions, considering the current market conditions and stock availability.
Why Did the Government Restrict Onion Exports?
- The government’s move to ban onion exports aimed to stabilize prices and prevent sudden fluctuations in the domestic market. Measures such as imposing a Minimum Export Price and export duties were implemented to control soaring onion prices.
- Factors like adverse weather conditions, reduced production, or increased demand could have resulted in onion scarcity within the country. By prohibiting exports, the government ensured that the available onion supply was prioritized for meeting domestic needs
Facts for prelims:
- India is the second largest producer of onion after China.
- Maharashtra, Karnataka, Orissa, Uttar Pradesh, Gujarat, Andhra Pradesh and Tamil Nadu are the major onion producing states.
