Govt bans export of all varieties of onions after prices touch Rs 80 per kg

The Union Ministry of Commerce and Industry on Sunday banned the export of all varieties of onions with immediate effect.

The development comes days after the prices of the basic kitchen staple skyrocketed across India. “Export policy of Onion is amended from free to prohibited till further orders. Hence, the export of all varieties of onions is prohibited with immediate effect,” a government notification said. Sitanshu Kar, Principal Spokesperson, Government of India, also tweeted saying, the Centre has prohibited “export of all varieties of #onions with immediate effect.”

The retail prices of onion, a key kitchen staple, shot up to Rs 70-80 per kg in Delhi and Mumbai in wake of excess monsoon rains in major growing states. The situation regarding the onion price hike is also bad in cities like Bengaluru and Chennai, where onion is being sold for up to Rs 60 per kg. A similar price trend has prevailed in other parts of the country as well.

The wholesale price of onion has touched Rs 4,000 per quintal (as per the Lasalgaon’s wholesale market data), recording a hike of about Rs 1,000 per quintal in the recent months. The onion price hike is the highest in the past four years. In the past six months alone, the onion prices have been up by almost Rs 25 per kg, says the Consumer Affair Department’s price monitoring cell data.

The excess monsoon in key producer states like Karnataka, Maharashtra, Madhya Pradesh, Gujarat, Rajasthan, Uttar Pradesh, and Bihar, has not only burned a hole in common man’s pocket but has also led to a shortfall in its supply.

So why are the onion prices rising? Trade analysts suggest onion prices see a spike during this time of the year because of floods and illegal hoarding of onion ahead of the festive season. The current spike in the onion prices is attributed to the excess rain this year due to which farmers could not harvest their crop in time, leading to an acute shortage of onion supply in the market.

Meanwhile, the Centre is taking measures to arrest the prices of onion. It has a buffer stock of 56,000 tonnes of onion, of which 16,000 tonnes has been offloaded so far. Central agencies like Nafed and the National Cooperative Consumers’ Federation of India have been selling onion from the buffer stock at Rs 22-23/kg, while Mother Dairy’s Safal stores are selling at Rs 23.90 per kg in the National Capital.

The state governments have also been asked to boost the supply by lifting central buffer stock. Some states like Delhi, Tripura and Andhra Pradesh have shown interest so far. Delhi Chief Minister Arvind Kejriwal on Friday said the Delhi government would sell onions for Rs 23.90 per kg, and that one person could get a maximum of 5 kg onions for their family.

“In addition to ensure that onions are available to citizens across the city, the government will make these available at 400 fair price shops even as it keeps a check on complaints of possible hoarding to create artificial scarcity in the market,” said Kejriwal on Friday. He added that 70 mobile vans will be deployed across each Assembly constituency.

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