Onion Export Duty Cut to Nil from 20%, Effective from
1 April, 2025
·
Centre withdraws 20% duty on Onion Export
effective from April 1st, 2025
·
Trade Heaves High of Relief as NCEL
Loses Monopoly on Exports
·
Rabi Crop Gets Access to Wider Market
·
Based on onion exporter data, India exports
the majority of its onions to Sri Lanka, Malaysia, and the United Arab Emirates,
and it is the world's largest onion exporter.
[Notification
No. 19/2025-Customs dated 22nd March, 2025]
G.S.R. ……(E). - In exercise of the powers conferred by sub-section
(1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government,
on being satisfied that it is necessary in the public interest so to do, hereby
makes the following further amendments in the notification of the Government of
India in the Ministry of Finance (Department of Revenue), No. 27/2011-Customs,
dated the 1st March, 2011, published in the Gazette of India, Extraordinary,
Part II, Section 3, Sub-section (i), vide number G.S.R.
153(E), dated the 1st March, 2011, namely :-
In the said notification, in the TABLE, against S. No. 1,
in column (4), for the entry, the entry “nil” shall be substituted.
2. This notification shall come into force from the 1st day
of April, 2025.
[F. No. 190354/43/2025-TRU]
The
Government of India has withdrawn 20% duty on onion export, effective from 1st April,
2025. A notification to this effect was issued by the Department of Revenue on 22
March, 2025 on the communication of Department of Consumer Affairs.
To
ensure domestic availability, the government had taken measures to check export
by means of duty, minimum export price (MEP) and even to the extent of export prohibition
for almost five months, from 8th December, 2023 till 3rd May, 2024. The export duty
of 20% which now stands removed has been in place from 13th September, 2024.
Despite
export restriction, the total onion export during FY 2023-24 was 17.17 LMT and FY
2024-25 (till 18th March) was 11.65 LMT. Monthly onion export quantity had picked
up from 0.72 LMT in September, 2024 to 1.85 LMT in January, 2025.
The
decision stands as another testament to the government’s commitment to ensuring
remunerative prices to farmers while maintaining affordability of onion to the consumers
at this crucial juncture when both mandi and retail prices have soften following expected arrival of rabi crops in good quantities.
Even though, the current mandi prices are above the level during corresponding period
of previous years, a decline of 39% is observed in the all-India weighted average
modal prices. Similarly, all-India average retail prices recorded declined of 10%
over the past one month.
Graph-1: Onion mandi and
retail price trends
Onion arrival in benchmark markets Lasalgoan and Pimpalgaon have increased
from this month which drive prices downward. The modal prices in Lasalgaon and Pimpalgoan on 21st March,
2025 were Rs.1330/qtl and Rs.1325/qtl,
respectively.
Graph-2: Arrivals and prices
in Lasalgaon Mandi
Graph-3:
Arrivals and prices in Pimpalgaon Mandi
As
per the estimates of Department of Agriculture & Farmers Welfare, rabi production
this year at 227 lakh metric tonnes (LMT) is over 18% higher than 192 LMT last year.
The rabi onion which accounted for 70-75% of India’s total onion production is crucial
for overall availability and stability in prices till the arrival of kharif crop
from October/November onward. The estimated higher production this season is expected
to further ease the market prices in coming months.
The
emerging production and prices scenario came as welcome breather for the country
which had to grapple with the twin issues of lower domestic production and high
international prices from August, 2023.