Government bans onion export as prices treble due to heavy rainfall

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The Indian government on Monday banned exports of all types of onions while referring to a shortage in supply in India itself owing to heavy rainfall and floods.

As per a notification dated 14th September issued by the Director General of Foreign Trade under the Ministry of Commerce and Industry, “exports of all varieties of onion (excluding cut, sliced or broken in powder form) is prohibited with immediate effect”, as prices tripled in a month after excessive rainfall hit crops in southern states.

The export of all varieties of onion was prohibited with immediate effect, the government notified.

Wholesale prices in the country’s largest onion trading hub, Lasalgaon in the western state of Maharashtra, have nearly trebled in a month to 30,000 rupees per tonne.

Ajit Shah, President of the Mumbai-based Onion Exporters’ Association said that excessive rainfall in the southern states of Karnataka and Andhra Pradesh has severely damaged summer-sown crop and led to a delay in harvesting in other states.

Also at the same time, onions would not be exported against the letters of credit (LCs) that were opened for onion import, nor for those whose tender processes had been completed.

India is the world’s biggest exporter of onions, a staple of South Asian cooking. Countries such as Bangladesh, Nepal, Malaysia and Sri Lanka rely on Indian shipments.

The Indian onion exporters’ association stopped exporting onions through all ports of the country.

No truck carrying onions have entered Bangladesh through Benapole in Jessore and Bhomra port in Satkhira since yesterday morning.

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