The Indian Government has decided to scrap the 20 per cent export duty on onions from April 1. A government press release said the Department of Revenue has issued a notification in this regard.
The Centre banned exports of onion on December 8, 2023, following a sharp drop in production due to El Nino weather. Before the elections, it lifted the ban and imposed a 40 per cent export duty on May 3, 2024. This was cut to 20 per cent on September 13, 2024.
Higher output
The scrapping of the duty follows requests from exporters and growers since India was losing its market share in the global market due to the export duty. Also, onion production has been estimated higher during the current crop year to June.
In its first advance estimate of horticultural crops, the Ministry of Agriculture and Farmers’ Welfare pegged onion production at 28.88 million tonnes (mt) during the current crop year compared with 24.27 mt a year ago. However, it is lower than the 2022-23 output of 30.21 mt.
The decision to scrap the export duty also comes after the modal price (the rate at which most trades take place) dropped by ₹850 a quintal since the beginning of this month to ₹1,420 from ₹2,270.
