India removes 20% duty on onion exports amid increased domestic supply

India removes 20% duty on onion exports amid increased domestic supply

The Indian Government has made the decision to revoke the 20 percent export duty on onions, effective from April 1. A government press release announced that the Department of Revenue has issued a notification regarding this matter.

The government introduced several measures, including a 20% export duty, a minimum export price (MEP), and even a ban on exports from December 8, 2023, to May 3, 2024 to ensure a stable domestic supply. The 20% export duty, which has now been lifted, had been in place since September 13, 2024.

Despite the export restrictions, India’s onion exports amounted to 17.17 LMT in FY 2023-24 and 11.65 LMT in FY 2024-25. The monthly export volume of onions grew from 0.72 LMT in September 2024 to 1.85 LMT in January 2025.

The government's decision highlights its ongoing efforts to strike a balance between supporting farmers and ensuring affordable prices for consumers, as mandi and retail prices have eased with the expected arrival of rabi crops. While mandi prices remain higher than last year, the all-India weighted average modal prices have fallen by 39%, and retail prices have dropped by 10% over the past month.

Onion arrivals in key markets such as Lasalgoan and Pimpalgaon have risen this month, leading to a decrease in prices. As of March 21, 2025, the modal prices in Lasalgoan and Pimpalgaon stood at Rs. 1330 per quintal and Rs. 1325 per quintal, respectively.

According to the Department of Agriculture & Farmers Welfare, India’s rabi onion production will reach 227 lakh metric tonnes (LMT), marking an 18% increase from last year's 192 LMT. This boost in production, which represents 70-75% of India’s total onion yield, is expected to help stabilize market prices until the kharif crop arrives in October/November.

This development comes as a relief after the country faced challenges with lower domestic production and high international prices since August 2023.