The central government had already planned to keep 3 lakh tonnes of onions on hand as a buffer stock for the 2023-24 season.
In order to improve domestic availability and stabilize soaring onion prices, the government on Saturday imposed a 40 per cent duty on the export of onions to check price rise and improve supplies in the domestic market. The Finance Ministry through a notification imposed a 40 per cent export duty on onions till December 31. The export duty comes amid reports that onion prices are likely to rise in September.
The move comes in the context of the government using trade-related measures to combat inflation. The government has already placed restrictions on the export of wheat and rice. Earlier, the Centre had reduced the import duty on edible oils.
The central government had already planned to keep 3 lakh tonnes of onions on hand as a buffer stock for the 2023-24 season. The government kept 2.51 lakh tonnes of onion as a buffer stock in 2022-23. If rates rise dramatically during the low supply season, a buffer stock is kept on hand to meet any emergencies and to keep prices stable.
Rabi onions harvested between April and June account for 65 percent of India’s onion production and sustain consumer demand until the Kharif crop is harvested between October and November.
