India Govt scraps minimum export price for onion

New Delhi, May 3 (PTI) The Indian government has decided to abolish the minimum export price of onion, to boost its exports and ensure better returns to growers. The decision to end fixing a benchmark price below which onion could not be exported was taken at a meeting on Wednesday chaired by Prime Minister Manmohan Singh, official sources said. It is expected to boost income of farmers, who did not get high remunerative price despite handsome production in 2011-12. To ensure that domestic markets remain unaffected by this step, it was also decided that the situation would be reviewed after every two months. The meeting was called after Agriculture Minister Sharad Pawar wrote to Singh raising objections to export policies of agriculture commodities such as sugar, cotton, onion and dairy products. Besides Pawar, Finance Minister Pranab Mukherjee,Commerce and Textiles Minister Anand Sharma and Food Minister K V Thomas also attended the meeting. Due to high export price of onions, India had lost its competitive edge in international onion markets to China and Egypt. Earlier in January this year, the government had lowered minimum export price (MEP) of all varieties of onions, except Bangalore Rose onions and Krishnapuram onions to USD 150 per tonne. India's onion production is estimated at 15.14 million tonnes during the 2011-12 crop year (July-June), which is higher than the previous year's output of 14.56 million tonnes. The western states of Maharashtra and Gujarat are the main producing regions of the kitchen staple. PTI