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Indian Government Facilitates Onion Export to Bangladesh Amidst Global Shortage

March 18, 2024 5:49 am

Indian Government Facilitates Onion Export to Bangladesh Amidst Global Shortage

In a move aimed at alleviating the onion shortage crisis, the Indian government has greenlit the export of 1,650 tonnes of onions to Bangladesh. National Cooperative Export Ltd (NCEL), acting as the export agency, will procure the onions from private traders at a rate of ₹29/kg, signaling India’s return to the global onion market after a hiatus of over three months.

The decision to resume exports follows the government’s ban on onion exports from December 8 to March 31, a measure aimed at stabilizing domestic prices. This ban, while effective in addressing local price volatility, inadvertently exacerbated the international onion shortage, leading to soaring prices globally.

Demand for onions from India’s traditional buyers, including Bangladesh and the Middle East, has surged, particularly during the ongoing Ramadan season. However, the export ban prompted concerns about smuggling, with reports suggesting significant quantities of onions were illicitly transported out of the country.

Despite the ban, onion prices in Maharashtra’s Nashik district, a key onion-producing region, have shown signs of stabilization, ranging between ₹7/kg to ₹16/kg. With the arrival of the fresh rabi harvest, further softening of prices is anticipated in the coming days.

While the exact pricing for Bangladeshi buyers remains undisclosed, industry insiders speculate that NCEL stands to make significant profits, given that onions are currently fetching much higher prices in Bangladesh, hovering between ₹80-90/kg.

Commenting on the situation, industry experts underscored India’s advantageous position in the global onion market during the first quarter of the year. Ajit Shah, president of the Horticulture Export Promotion Council (HEPA), noted that the global onion shortage is expected to ease with the commencement of new crop arrivals from Egypt and Turkey in May.

As India re-enters the international onion trade, stakeholders hope for a balanced approach that not only addresses domestic concerns but also ensures fair access to global markets, fostering stability and sustainability in the onion trade ecosystem.

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