Modi Government Abolishes 20% Onion Export Duty Starting April 2025, Ensuring Stability for Farmers and Domestic Prices Amid Market Fluctuations

Modi Government Abolishes 20% Export Duty on Onions

The Modi government has made a significant announcement to remove the 20% export duty on onions, effective from 1 April 2025. This move aims to support farmers and ensure that onion prices remain stable in the domestic market.

Details of the Decision

According to a notification from the Central Board of Indirect Taxes and Customs (CBIC), this decision has been taken with public interest in mind. Currently, there is a 20% fee on onion exports, but starting 1 April 2025, this will be eliminated.

Previous Decisions on Onion Exports

– **December 2023**: The government imposed a ban on onion exports due to a sharp rise in domestic prices.

– **May 2024**: The export ban was lifted, but a minimum export price (MEP) of $550 per ton was set, along with a 40% export duty.

– **September 2024**: The MEP was removed, and the export duty was reduced to 20%.

Impact on Exports and Prices

In the financial year 2023-24, around 17.17 lakh tonnes of onions were exported. For the financial year 2024-25, up until 18 March, exports reached 11.65 lakh tonnes. Notably, onion exports were 72 thousand tonnes in September 2024, which rose to 1.85 lakh tonnes by January 2025.

Government’s Intentions

The Ministry of Consumer Affairs states that this decision is aimed at providing fair prices for farmers while also keeping onion prices manageable for consumers. The market has seen good arrivals from the Rabi crop, and while current prices are higher than in previous years, the overall average model prices have decreased by 39%, with retail prices dropping by 10%.

This government action is expected to offer relief to farmers and contribute to stable onion prices in the domestic market.