In a major development set to support onion farmers in the country, the central government on Saturday announced its decision to do away with a 20 per cent duty on the export of the bulb, with effect from April 1. Onions are a widely used kitchen staple used as a household as well as commercial ingredient across the length and breadth of the country.
The removal of of duty comes a little more than six months since its introduction in mid-September last year, according to an official communication by the Ministry of Consumer Affairs, Food and Public Distribution.
The Union government imposes and reviews duties on the exports of select goods for several reasons, including adjusting demand-supply dynamics and controlling price variations in order to protect consumers.
Onion Export Duty Removed—What does it mean for growers?
The prompt action on the export duty can lead to higher farmer income while reducing the cost of trading the commodity abroad that could lead to better rates in the foreign markets.
Onion Export Duty & Export Ban—Why was it introduced?
In the past two years, the government took a slew of measures to ensure ample availability of onions in the domestic market. Its steps included the imposition of export duty, the setting up of a minimum export price (MEP) and a complete ban on exports spanning more than five months, from December 8, 2023, to May 3, 2024.
However, a total of 11.65 LMT of onions were exported in FY25, as against 17.17 LMT the previous year, with the monthly exports picking up from 0.72 LMT in September 2024 to 1.85 LMT in January 2025, according to the official statement.
The government said it remains committed to “ensuring remunerative prices to farmers” while preserving onion affordability for the consumer. Both wholesale and retail prices have softened amid healthy supplies of rabi crops.
Retail and Wholesale Onion Prices
As of March 21, the modal prices in Lasalgaon and Pimpalgoan stood at Rs 1,330 per quintal and Rs 1,325 per quintal, respectively.
Image source: Official
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Meanwhile, the domestic rabi onion production stands 18 per cent higher on a yearon-year basis, at 227 lakh metric tonnes (LMT), according ot data from Department of Agriculture and Farmers Welfare.
The rabi onion is crucial for overall availability and stability in prices till the arrival of kharif crop from the months of October-November.
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Rabi onion supplies account for 70-75 per cent of the country’s total onion production every year.
