FAQ: WHY WAS A 40% DUTY IMPOSED ON ONION EXPORTS?
Current Affairs for 27th August, 2023
FAQ: WHY WAS A 40% DUTY IMPOSED ON ONION EXPORTS?
In order to increase the availability of onions in the market the government imposed a 40% duty on its export until the end of the year. Despite this, the government will also be offloading its onion stocks in various wholesale markets to reduce retail prices.
The two measures are aimed at infusing stocks into the market to stabilize prices and mitigate the demand-supply mismatch. The reasons for this are go back to higher-than-normal temperatures in the start of the year, followed by unseasonal rainfall.
• Onion crops in India are grown across three seasons, namely kharif, late kharif and Rabi. They are planted around July-Aug and harvested between October and December; between October-November and January-March; and March-end and Dec-Jan respectively.
• The Rabi crop of onion contributes most to production in a calendar year.
• Maharashtra is the largest onion producing state, contributing to 39% to the overall production, followed by Madhya Pradesh at 17%.
• Onions usually grow best under mild weather conditions. The sudden increase in temperature in February led to the early maturity of the crop, which resulted in a small-sized bulb.
• India is the third largest exporter of onion after the Netherlands and Mexico. Its major export destinations include Bangladesh, Malaysia, the UAE, Sri Lanka, Nepal, Indonesia, Qatar, Vietnam, Oman and Kuwait.
In order to increase the availability of onions in the market the government imposed a 40% duty on its export until the end of the year. Despite this, the government will also be offloading its onion stocks in various wholesale markets to reduce retail prices.
The two measures are aimed at infusing stocks into the market to stabilize prices and mitigate the demand-supply mismatch. The reasons for this are go back to higher-than-normal temperatures in the start of the year, followed by unseasonal rainfall.
• Onion crops in India are grown across three seasons, namely kharif, late kharif and Rabi. They are planted around July-Aug and harvested between October and December; between October-November and January-March; and March-end and Dec-Jan respectively.
• The Rabi crop of onion contributes most to production in a calendar year.
• Maharashtra is the largest onion producing state, contributing to 39% to the overall production, followed by Madhya Pradesh at 17%.
• Onions usually grow best under mild weather conditions. The sudden increase in temperature in February led to the early maturity of the crop, which resulted in a small-sized bulb.
• India is the third largest exporter of onion after the Netherlands and Mexico. Its major export destinations include Bangladesh, Malaysia, the UAE, Sri Lanka, Nepal, Indonesia, Qatar, Vietnam, Oman and Kuwait.