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India to allow limited quantity of onion exports to Bangladesh

India has allowed exports of onions through a government-to-government basis to Bangladesh and some other countries on its Ministry of External Affairs’ recommendation.

A person familiar with the matter said a limited quantity of onion exports has been allowed for bilateral purposes though no decision has been taken on lifting a complete ban on onion exports, reports the Economic Times.

Details of the exporting agency could not be ascertained, said the report.

According to the report, another person said the government permitted exports of onions in limited quantities to Sri Lanka, Mauritius, Bahrain, Bhutan and Nepal, among others.

India, the world’s second largest onion exporter, had banned shipments of the kitchen staple in December 2023 till March 2024 due to rising domestic prices and potential shortages. This led to a surge in onion prices in neighbouring countries.

As onion prices started to rise in August 2023, the finance ministry imposed a 40% export duty to curtail shipments. However, it failed to have the desired effect due to under invoicing, prompting the government to impose a minimum export price of $800 per tonne on onions effective October 28.

Some large exporters wrote to the government on Sunday, suggesting that instead of completely banning onion exports, the government should permit outward shipments on a restricted basis, adding that any major export volume can lead to a significant price rise in the domestic market, the daily reported.

Earlier on 9 February, Bangladesh sought India’s support in supplying essential commodities, specially onion from India ahead of the holy month of Ramadan in an effort to keep prices of the essentials stable.

“We discussed the import of perishable items from India. We have discussed in detail so that we get 50 thousand tonnes of onion and 1 lakh tonnes of sugar before Ramadan,” Foreign Minister Hasan Mahmud told reporters after his meeting with India’s Commerce and Industry Minister Piyush Goyal.

The foreign minister mentioned that the new government under the leadership of Prime Minister Sheikh Hasina begins a fresh journey with new mandates, and one of the priorities of the government is to address the prices of essential commodities.

Hasan requested Goyal to take necessary measures in ensuring uninterrupted supply of the essential commodities to Bangladesh till Ramadan.

Goyal said India is committed to ensuring the economic and financial stability in Bangladesh.

He assured of accommodating the request of Bangladesh foreign minister for supplying essential commodities.

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