The Government has directed NCCF and NAFED to initiate the procurement of 500,000 metric tonnes of onions directly from farmers to fulfil the buffer requirement. This directive, timed with the onset of the Rabi-2024 harvest in the market, aims to ensure an adequate supply. To streamline this procurement process, NAFED and NCCF will pre-register onion farmers, ensuring direct transfer of payments to their bank accounts through Direct Benefit Transfer.
Rabi onions play a crucial role in the country’s onion supply, accounting for 72-75% of the annual production. Their longer shelf life compared to Kharif onions allows for storage until November-December, ensuring year-round availability.
In the previous fiscal year 2023-24, the Department of Consumer Affairs, through NAFED and NCCF, procured approximately 6.4 million metric tonnes of onions for buffer stocking and intervention purposes. This consistent procurement ensured fair prices for onion farmers throughout the year. Additionally, retail sale interventions were conducted through outlets operated by NCCF, NAFED, Kendriya Bhandar, and other state-controlled cooperatives, selling onions at a subsidized price of Rs. 25 per kg. These interventions effectively stabilized retail prices without negatively impacting farmer incomes.
In response to global supply constraints and El Niño-induced dry spells, the government implemented policy measures to regulate onion exports in the fiscal year 2023-24. These measures included imposing a 40% duty on onion exports starting from August 19, 2023, establishing a Minimum Export Price (MEP) of USD 800 per metric ton effective from October 29, 2023, and implementing a complete export prohibition from December 8, 2023. These steps were taken to ensure ample availability of onions for domestic consumers at reasonable prices.
The recent decision to extend the prohibition on onion exports reflects considerations of domestic availability in light of international prices and global supply concerns. However, exports to neighbouring countries that depend on India for their onion requirements have been permitted. Export quotas have been allocated to Bhutan (550 MT), Bahrain (3,000 MT), Mauritius (1,200 MT), Bangladesh (50,000 MT), and the UAE (14,400 MT, distributed as 3,600 MT per quarter).
