New Delhi, August 20 – In a bid to stabilize the availability and curb the escalating prices of onions in the domestic market, the Indian government has taken a decisive step by implementing a 40% export duty on onions, effective immediately. This heightened duty will be in effect until the end of December 2023.
The official notification issued today to raise the export duty on onions highlights the imperative nature of this decision in the interest of the public. The notification clearly states, “This notification shall come into force with immediate effect and will remain in force up to and inclusive of the 31st of December, 2023.”
The surge in onion prices within local markets over the recent weeks has not only burdened household budgets but also sparked concerns about inflation. The soaring vegetable prices contributed to a staggering inflation rate of 7.44% in July, significantly surpassing the Reserve Bank of India’s upper tolerance limit of 6%.
The notable increase in food inflation, specifically by 11.5% in July from 4.5% in June and 3% in May, can be attributed to the rapidly escalating costs of vegetables, cereals, pulses, spices, and milk. This level of food inflation is reported to be the highest since April 2020, according to Crisil, a prominent research and rating firm.
Recent times have also witnessed tomato prices reaching unprecedented levels of Rs 250-300 per kilo in various parts of the country. Although there has been a slight decrease in prices over the last few days, tomatoes still command a relatively high price of Rs 70-100 per kilo.
As inflationary pressures continue to weigh on consumers and impact their cost of living, the government’s move to impose export duty on onions is a strategic effort to ensure that adequate supplies are maintained in the domestic market, ultimately contributing to price stability and mitigating financial strain for households.
