Onion farmers worried over a possible export ban as prices rise

New Delhi, June 13: Concerns among farmers growing onions are rising as retail prices of this essential kitchen ingredient have soared in the last few weeks. Many fear that the rising prices could prompt the government to impose a ban on exports. Last month the government, without notice, halted the outbound shipment of wheat as well to rein in domestic prices.

Prices of vegetables have been increasing continuously amid the intense heat wave which has led to shortage. At present, price of onion is around Rs 25-30 for a kilogram. Barely two months ago, it was around Rs 10 a kilo.

"Farmers are worried..there is apprehension that with rising prices of onion in the domestic market, the government could impose a ban on exports. If exports are suddenly banned, not only do our farmers suffer but even our export markets get dented. It becomes difficult for us to get export orders," Anil Ghanwat, senior leader of Shetkari Sangathana, a Maharashtra based farmers union told India Narrative. "Such sudden bans in the past have considerably eroded our export market," he said.

While onion production is expected to increase by 16.81 per cent to 31.12 million tonnes this year, farmers associations said that a ban on exports "will cause great loss to the farming community."

In 2020-21, the volume of onion production in India was around 27 million metric tons. Barring 2019, production of this vegetable has been increasing.

"Over the last eight years, our government has taken into consideration the interest of producers as well in chalking out the import and export policies. Maintaining balance between the interest of the consumers and producers will be the driving force," Gopal Krishna Agarwal, national spokesperson of the BJP said.

Sudden bans on onion exports earlier have had far reaching diplomatic implications with importing countries including Bangladesh.

Bangladesh Prime Minister Sheikh Hasina during her visit to India in October 2019 had joked about the ban of this vegetable while speaking at an economic forum. "It has become difficult for us to get onions. I don't know why you stopped the supply. I've told my cook to make food without onions," she said then. The Bangladesh PM also said that India should have given some notice before imposing a ban on the vegetable. In 2020 too amid the Covid pandemic, New Delhi had stopped exports of onions after a surge in domestic prices.

Besides, Bangladesh, UAE, Malaysia, Sri Lanka and several other countries in the middle east are the top importers of Indian onions.

A policymaker with an industry body said that India needs to look at expanding its role as a major global food supplier. "For that well thought out policy measures are key, the government must maintain stability and continuity in the policy framework, if it wants to add more markets. New Delhi must position itself as a dependable and credible trade partner," he said.

Maharashtra and Karnataka are the two most important producers of onion.

The cost of production for a kilo of onions is about Rs 14-16. This includes, cost of fertiliser, labour and seeds among other things. But the cost of storing further adds to the overall price.

"Farmers must be allowed to price their crops in a manner that their investment costs are covered," Ghanwat said.