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Ban on export of onion

Topics Covered:

  1. Major crops cropping patterns in various parts of the country, different types of irrigation and irrigation systems storage, transport and marketing of agricultural produce and issues and related constraints; e-technology in the aid of farmers.

 

Ban on export of onion

 

What to study?

For Prelims: Why onion prices are on rise? Overview of the policy.

For Mains: Can the ban help? What else can be done?

 

Context: In a bid to tame onion prices, which have doubled in the domestic retail market since July, the government has taken the following decisions;

  1. Banned exports of all varieties of onion.
  2. Imposed stock limits on onion traders to facilitate release of stocks and prevent hoarding by traders. 

In this regard, Commerce and industry ministry amended the export policy of onion, making it ‘prohibited’ from ‘free’ earlier. 

 

Implications:

Retail traders across the country will now be able to stock only up to 100 quintals of onion while wholesale traders will be allowed to stock up to 500 quintals. 

 

What do experts say?

A ban is an irrational, and sub-optimal solution. Instead, efforts should be channelized into investing in scientific storage and processing facilities that will help augment supplies during a crisis. 

 

Need of the hour:

  1. Promote modern cold storages and develop a system similar to that of the warehouse receipt system for farmers. 
  2. States must launch a concerted intelligence drive to crack down on hoarders and bring the stocks to the market swiftly. 
  3. Encourage imports.
  4. Set up onion dehydrating units and promote demand for dehydrated onions amongst large consumers.

 

Way ahead:

More policy making and political attention should be devoted to raising onion output, or for that matter farm output in general. Complacency on the farm front is wholly avoidable. 

 

Sources: pib.