Indian exporters demand that the government reduce the export tax on onions in light of an increase in crop

Due to the expected increase in fresh onion crop, Indian exporters are advocating that the government eliminate the 20 % export tax. They say that the Horticulture Produce Exporters Association (HPEA) is scheduled to officially submit this proposal to the Centre and aims to boost India’s ability to compete within its international market. Vikas Singh of HPEA’s vice president has highlighted the difference in the prices of exports between India as well as its rivals including Pakistan. According to him, “India’s export prices range between $600 and $720 per tonne, whereas Pakistan has onions priced at about 500 dollars per tonne.”

According to Singh that removing the duty on exports could bring the prices of Indian onions more closely to the mark of $500 per ton and could boost the demand of Indian onions across the globe. This is believed to be a necessity because India expects to see a large increase in late kharif as well as summer onions, due to the increase in plantations. This anticipated increase in production could reduce retail prices in India and highlight the need for increased export possibilities to prevent the possibility of a glut in markets.

The previous government cut the export duties on onions of 40 per cent to 20 percent, and lifted the minimum price for export (MEP) that was set at $550 for a ton as of the 13th of September. However, despite these measures, the onions exports have decreased in the last few months, with an Agricultural and Processed Food Products Exports Development Authority (APEDA) having reported a decline to 403,000 tonnes in the first quarter of this fiscal year, down from 1.31 million tonnes in the previous year’s comparable period. Exporters think that the revocation of the current duty on exports is essential to restore India’s position as a competitive player in the world onion market.

Source: KNN India

Source: The Plantations International Agroforestry Group of Companies