The Centre continued its farmer-friendly policies late into Friday night, reducing the export duty on onion to 20 per cent and raising the Customs duty on edible oils by 20 per cent .

The decisions are timed ahead of the harvest of kharif crops due shortly. They were taken by the Cabinet Committee on Prices headed by Union Home and Cooperation Minister Amit Shah on Wednesday.

Late on Friday night, the Centre issued the order halving the export duty on onion from 40 per cent. Earlier in the day, it removed the $550 a tonne minimum export price (MEP) for onions. 

In separate orders, the Government increased the duty on crude palm, soyabean and sunflower oil to 20 per cent from zero per cent, while increasing the levy on refined palm, soyabean and sunflower oils to 32.5 per cent from 12.5 per cent. It also fixed the tariff rate at which the import duty will be levied.

 Political move

Taking to social media, Agriculture Minister Shivraj Singh Chouhan said the government is committed to the progress of farmers. The export duty reduction will help onion-producing farmers get good prices for onion and export of onion will also increase, he said, adding farmers and other onion-related sectors will also benefit.

The duty cut could help bridge the competitiveness of Indian onion to some extent in the global market, said M Madan Prakash, President of the Agricultural Commodities Exporters’ Association. “Turkey, Egypt and Pakistan are offering at about $600 a tonne (C&F) to Malaysia. Our prices could be around $700,” he said. 

The decisions to remove the MEP and cut export duty are seen as a move to placate the onion growers of the Nashik belt ahead of assembly polls in the State later this year.

Higher price for oilseeds

According to Crop Watch Weather Group data, kharif onion has been planted on 2.90 lakh hectares (lh) as of August 29, against 1.94 lh during the same period a year ago. Sowing has exceeded the total kharif acreage of 2.85 lh a year ago.

 For edible oil imports, the 5 per cent agricultural infrastructure development cess will apply in addition to the import levy. The hike in the Customs duty on edible oils will help farmers get better prices for their kharif oilseeds after the rates dropped below the minimum support price fixed for the current crop year.

Related Topics