Nashik wholesale markets indefinitely shut onion auctions to protest 40% export duty, say traders.

Traders in Nashik have taken a strong stance against the central government’s decision to impose a 40% duty on onion exports until December 31, 2023, citing detrimental impacts on onion growers and the export trade. On August 21, these traders declared an indefinite shutdown of onion auctions across all Agriculture Produce Market Committees (APMCs) in Maharashtra’s Nashik district as a protest against this decision.

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This move has resulted in the closure of onion auctions at multiple APMCs in Nashik, including the prominent Lasalgaon market, which is the largest wholesale onion market in India. The traders argue that the government’s imposition of the 40% export duty will significantly harm both the interests of onion growers and the export industry.

The decision to halt onion auctions was made during a meeting of the Nashik District Onion Traders Association, chaired by its president, Khandu Deore. According to Deore, the meeting’s participants discussed the practical implications of the export duty and its ramifications on farmers. The consensus was that in instances where onions have already arrived at an APMC, their auction will proceed, but afterward, auctions will be put on indefinite hold as per the requests made by various farmers’ organizations.

Sanjay Pingle, the president of the onion-potato market at the Vashi APMC in Navi Mumbai, expressed concern about the adverse effects of the export duty on onion growers. He mentioned that numerous farmers’ associations had urged them to cease onion sales, as they felt the pressure to do so. Pingle highlighted that this protest was not confined to Nashik alone, as he anticipated that local markets would eventually follow suit in closing auctions.

Pingle went on to explain that the 40% export duty would drastically impact the profitability of onion exports. He detailed that the export price, previously at ₹25 per kg, would plummet to ₹15 per kg due to the imposed duty. Consequently, this reduced price would not even cover the production costs for farmers. Pingle attributed the prevailing circumstances to an erroneous report submitted to the central government, which failed to account for the increased expenses incurred during onion cultivation, such as fertilizer and labor costs.

Furthermore, Pingle emphasized that despite the existing stockpile of onions in Maharashtra and Madhya Pradesh, the government’s decision could lead to an overabundance of onions domestically. He urged the government to consider subsidizing onions through the public distribution system (PDS), akin to what is done with rice and wheat, to ensure affordability for consumers.

Pingle also voiced concerns about the international market dynamics, indicating that Pakistan, Iran, and Egypt could potentially benefit from reduced Indian exports. He urged Union Minister Nitin Gadkari to intervene on this matter and suggested that stakeholders’ concerns be taken into account before implementing such policies.

Overall, the indefinite suspension of onion auctions and the protests by traders signify a widespread objection to the export duty’s potential repercussions on the onion industry and farming community. The traders’ call for a meeting involving all stakeholders and the government highlights their intent to ensure that the policy is thoughtfully considered and its impacts fully understood before implementation.

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