Farmers, traders question 40% duty on onion exports

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The Centre on Saturday imposed a 40 per cent duty on the export of onions. The national average prices of essential vegetables increased by at least ₹5 compared to last year. Farmers and onion traders have questioned the government’s move, saying it will harm farmers and hit the trade.

“This decision is anti-farmer and also will have an impact on India’s credibility in the international market. Onion farmers are agitated and we support the decision of onion traders to stop trading” said farmer leader Anil Ghanwat. Onion farmers in the State have been demanding that the government support farmers to improve storage facilities instead of making haphazard decisions to control prices.

According to government data on average, India consumes an estimated 1.3 million tonnes of onion every month. To meet this demand, farmers grow the crop in three seasons — kharif, late kharif and rabi.

Massive losses

Onion, a semi-perishable vegetable harvested during rabi season, accounts for 65 per cent of the total production and hits the markets from April to May. The same crop continues in the market till October-November every year before the kharif crop is harvested.

According to the Ministry of Consumer Affairs’ note on onions, even as it is vital to successfully store onions in order to meet the regular supply it is observed that nearly 30-40 per cent of the crop is lost during storage due to various reasons in the form of physiological weight loss, rotting, sprouting etc. “In unexpected situations such as natural calamities, the losses even go beyond 50 per cent, creating heavy stress both on demand and supply sides. The losses occurred during storage is in terms of qualitative as well as in quantitative ways” the note adds. According to the Ministry due to improper storage systems, annual losses amount to about ₹11,000 crore.

 Infrastructure demand

India is the second-largest onion-growing country in the world. According to APEDA, there is demand for onions in the world. The country has exported 25.25 lakh tonnes of fresh onion, worth ₹4,522.79 crore ($561.38 million) in the 2022-23 fiscal.

“Instead of taking advantage of India’s position in the international market, we are restricting exports. The government must instead provide basic infrastructure and boost investment so that farmers have high-quality storage systems,” says Bharat Dighole, president of the Maharashtra State Onion Growers Association.