Government to Procure 5 Lakh Tonnes of Rabi Onions from Farmers for a Stable Retail Price

Upon the arrival of the Rabi-2024 harvest in the market, the Government has directed the National Cooperative Consumer Federation (NCCF) and the National Agricultural Cooperative Marketing Federation of India (NAFED) to initiate the procurement of 5 lakh tonnes of onions directly from farmers. This move aims to meet the requirement and ensure stability in onion prices.

Rabi onion, which accounts for 72-75% of the country's annual onion production, is crucial for maintaining year-round availability due to its longer shelf life compared to Kharif onion. Recognizing its significance, the government has prioritized its procurement to secure supplies until November-December.

In the preceding year, the Department of Consumer Affairs, through NAFED and NCCF, procured approximately 6.4 Lakh Metric Tonnes (LMT) of onions for buffer stocking and intervention purposes. These procurements ensured steady and remunerative prices for onion farmers throughout 2023. Additionally, retail sale interventions were conducted through outlets operated by various cooperatives, offering onions at subsidized rates of Rs. 25 per kilogram. This strategic intervention effectively stabilized retail prices without adversely affecting farmer incomes.

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Given the global supply scenario and challenges posed by a dry spell induced by El Niño, the government implemented various policy measures to regulate onion exports during the fiscal year 2023-24. These measures included imposing a 40% duty on onion exports, setting a Minimum Export Price (MEP) of USD 800 per Metric Tonne, and eventually prohibiting exports altogether from December 8, 2023. These steps aimed to ensure ample onion availability for domestic consumers at affordable prices.

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The recent decision to extend the prohibition on onion exports stems from concerns regarding overall domestic availability vis-a-vis international prices and global supply conditions. However, recognizing the dependency of neighbouring countries on Indian onions for their domestic consumption, the government has permitted exports to selected destinations. Bhutan, Bahrain, Mauritius, Bangladesh, and the UAE have been allowed specific export quotas to meet their onion requirements.

This directive underscores the government's commitment to stabilize onion prices, support farmers, and ensure adequate onion supplies for domestic consumption. By procuring directly from farmers and implementing export controls, the government aims to strike a balance between domestic demand and international commitments, safeguarding both consumer interests and farmer livelihoods.

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