Onion exports banned by India

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Onion exports banned by India

Onion exports banned by India

Recently, the export of onions was banned by India, against which the US and Japan have filed objections against India in the World Trade Organization (WTO).

Both countries have alleged that the ban on exports without prior notice creates problems for the importing countries.

Also, onion growers in India have demanded that the central government should draft a comprehensive policy on import and export of onions instead of taking ad-hoc decisions.

Need for comprehensive policy on onion

  • To curb the demand-supply imbalance in the domestic market to aid exports.
  • Onion growers have also suffered huge losses due to the indefinite ban on export of onions.
  • The ban on export of onions is causing distortion in bilateral trade relations with countries like Bangladesh.
  • Pakistan has started competing with the share of Indian onions in the market of Gulf countries since last few years.
  • One should take advantage of the opportunity, as export of onions is one of the main means of earning foreign exchange for the government.
  • India is the second-largest onion-producing country (after China).
  • In the fiscal year 2021, India exported onions worth $378 million, a 15 percent increase over the previous year.
  • The top export destinations were Bangladesh, Malaysia, the United Arab Emirates and Sri Lanka.

Initiatives taken by Government

  • Merchandise Export Incentive Scheme (MEIS): Incentives exports during the harvest of surplus onions.
  • Operation Greens: In order to maintain the supply-demand balance of onions and to control price volatility.
  • Integrated Horticulture Development Mission: Under the Mission for Integrated Development of Horticulture (MIDH), low-cost onion storage structures have been constructed with 50 percent subsidy to the farmers.

Source: The Hindu

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