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With onion prices in the wholesale markets of Maharashtra and elsewhere dropping to Rs 6-7 a kg, the government on Tuesday abolished the minimum export price (MEP).
In December, the commerce ministry had reduced the MEP from $350 a tonne to $150 a tonne to boost exports and check the sharp fall in domestic prices.
The MEP was imposed in September when prices were very high. Thereafter, the MEP had to be raised several times to curb exports and boost domestic supplies as retail prices had shot up to Rs 100 a kg. To control the rise, India even had to import.
But now the situation has reversed. According to reports, exports fell to 853,000 tonnes during April-November of this financial year against 1,822,000 tonnes a year ago.
In FY13, India had exported 1.82 million tonnes. India's annual onion production is estimated at 19 million tonnes in 2013-14, while in 2012-13 it was estimated to be 16.8 million.
