Ahead of key state elections, the Modi government has taken a major step to support farmers by removing the Minimum Export Price (MEP) on onions and basmati rice. This decision, announced by the Union Commerce Ministry late on Friday (13) evening, eliminates the $550 per ton MEP for onions and $950 per ton for basmati rice. The move is seen as a relief for farmers struggling with export restrictions.
Farmers, however, remain cautious. While the government claims this will boost exports and increase farmer income, many are skeptical, especially with rising onion prices in the retail market. Some farmers argue that the decision came too late to benefit onion growers significantly. Additionally, they are asking when the existing 40% export duty on onions will be lifted.
In December of last year, the central government imposed a ban on onion exports ahead of the Lok Sabha elections, but the move was reversed in May due to backlash from farmers. Maharashtra’s Deputy Chief Minister Ajit Pawar even apologized to onion growers for the export restrictions.
With assembly elections approaching in Maharashtra and Haryana, some believe the government’s move is politically motivated, aiming to win over the farming community. The export of onions to key markets like Malaysia, UAE, and Bangladesh has slowed in recent months due to the MEP, and farmers now hope that exports will pick up again.
However, there is still uncertainty about the 40% export duty, with the State Onion Producers Association pushing for its removal to open up the export market fully.
“ We welcome the decision however, the government should not impose any restrictions on onion exports,” said Bharat Dighole, President of the State Onion Producers Association.