The Centre on Thursday asked all state governments to remove Mandi tax, a fee on the sale and purchase of agricultural products, with immediate effect and lifted all restrictions on the export of agro products barring highly sensitive onion and a few others.

The decision was taken by the Union Cabinet chaired by Prime Minister Narendra Modi.

The Cabinet also decided to remove all export restrictions on organic and agro-processed food products under the first ever agriculture export policy in the country which aims to double farm sector exports to $60 billion by 2022.

The policy was cleared by the cabinet at a time when farmers across India are up against the government and want a special session of Parliament to discuss their distress.

Under the new policy, high value, value-added and perishable agro products will be given special preference.

The Cabinet also decided to set up state clusters for export promotion of agro products.

Talking to reporters, Commerce and Industry Minister Suresh Prabhu said, “The new agricultural export policy is in-line with the prime minister's stated commitment of doubling farmers' income by 2022. The policy has been formulated after extensive consultation with state governments”.