Government rules out banning onion export

NEW DELHI: Government today ruled out banning export of onion saying the spurt in domestic prices was "temporary" caused by unseasonable rains and mandi closures.

"We have adequate stocks (of onion). We have no shortage and position is as such comfortable," Commerce Minister Anand Sharma said during Question Hour in Rajya Sabha.

Only surplus production after taking into account all of domestic consumption, is allowed to be exported, he said, adding domestic production of onion at 17 million tons is more than the demand of about 15 million tons.

"The export policy of agricultural produce depends on various factors including availability of surplus over and above the requirement of buffer stock including strategic reserves," he said.

Out of the total onion production in the country, 84 per cent was consumed domestically and six per cent is used for creating buffer stock. Only 7 per cent is exported, he said.

"We cannot abruptly stop exports," he said, citing sovereign supply commitments that may have been made. Besides, stopping exports would mean yielding the space in international commodity market to rivals.

Rains in Rajasthan and Madhya Pradesh as well as closure of Azadpur Mandi in the national capital for four days led to "temporary spurt" in prices in January/February.

"The temporary spurt in the prices beginning from January 22 continued for a fortnight and have since stabilised. The wholesale price in Azadpur Mandi in Delhi on March 11 was Rs 13.10 per kg," he said.

He, however, admitted that the retail price may be higher by up to Rs 10-11 per kg because of number of intermediaries involved.