Centre lifts export ban on onions

Move follows bumper harvest of the vegetable

An empowered group of ministers (EGoM) headed by Finance Minister Pranab Mukherjee allowed export of  the “rose” variety of onion grown in Karnatka along with three types of non-Basmati rice grown in southern states.

Two months after the onion crisis resulted in imports from Pakistan, the Centre is under pressure to lift the ban on export following a bumper onion harvest. On the wholesale market in Nasik, onion prices crashed from Rs 6,300 per quintal on December 20, last year, to Rs 450-500 per quintal on Wednesday, forcing angry  farmers to block the Mumbai-Agra highway with the demand of lifting the ban on export.

India stopped onion export in the third week of December 2010 after its price went through the roof across the entire country.

Unseasonal rain coupled with mismanagement of existing stock was believed to have led to the crisis, compelling the government to import a few thousand tonnes of onion from Pakistan. But the situation turned around within six weeks.

“Limited export of onion should be allowed,” agriculture minister Sharad Pawar said here after providing some good news on other crops.

India achieved record production of wheat (81.47 million tonnes compared to 80.8 million tonnes last year), pulses (16.51 million tonnes as against 14.66 million tonnes) and cotton (339.27 lakh bales of 170 kg each as against 242.25 lakh) this year despite significant crop damage due to drought in Bihar, Jharkhand, Orissa and West Bengal.

With a total estimated food grain production of 232.07 million tonnes, the current financial year may end up as India's second best in terms of rice and wheat production. It will be marginally below the record production of 234.47 million tonnes in 2008-09.

Asked why the prices of agricultural commodities are not coming down in retail market despite bumper crops, Pawar said he could not answer the question as he was not an economist. But even as the government is battling a 17 per cent food inflation, the EGoM partially lifted the three-year-old ban on overseas shipment of rice grain. Up to 1.5 lakh tonnes of select varieties would be allowed to export.

The three varieties exempted from export ban are “Ponni Samba,” “Rosematta” and “Sona Masuri” grown in Tamil Nadu, Kerala, AP and Karnataka. The exemptions will be given only if exports are valued at more than $850 per tonne.