Why Maharashtra Onion Farmers Are Demanding Export Duty Removal?

A steep 50 per cent drop in onion procurement prices over the past fortnight has dealt a severe blow to farmers. Prices, which stood at Rs 3,600 per quintal on December 12, have plummeted to Rs 1,725 per quintal as of Monday. This sharp decline has prompted farmer associations to demand the removal of the 20 per cent export duty on onions to boost exports and stabilise prices, according to a Hindustan Times (HT) report.

The sudden fall in prices is attributed to the fresh harvest of late kharif onions flooding the market, coupled with the existing export duty. Additionally, government agencies such as NAFED and the National Consumers Federation of India have released previously procured stocks into the market, adding to the oversupply and further driving down prices.

Photo Credit: PTI

Farmers are now bearing significant losses, with input costs for cultivating onions per acre estimated at Rs 80,000. However, current prices only yield returns of Rs 60,000, resulting in a loss of Rs 20,000 per acre. Bharat Dighole, founder president of the Maharashtra State Onion Producer Farmers Organisation, has urged the central government to lift the export duty immediately. "This is not the time to retain the duty, as there is no shortage, and prices have collapsed," he stated in the HT report.

Maharashtra, India's largest onion-producing state, has been hit particularly hard. Lasalgaon in Nashik district, home to Asia's largest wholesale onion market, has seen an average daily inflow of 2,500 quintals of late kharif onions over the last 15 days. These onions are selling at an average price of Rs 1,725 per quintal, well below the Rs 3,000 per quintal required for farmers to make a profit.

The frustration among farmers was evident during a rally addressed by Fisheries and Ports Minister Nitesh Rane in Baglan, Nashik, on Monday. In a symbolic act of protest, farmer Mahindra Surayawanshi placed a garland of onions around the minister's neck. Surayawanshi was later questioned by police for several hours.

Deputy Chief Minister Ajit Pawar has also called on the BJP-led central government to remove the export duty, describing it as crucial for providing relief to farmers facing dire losses.

The export duty on onions was first introduced at 40 per cent in October 2023, before being reduced to 20 per cent in May 2024 during the Lok Sabha election period to quell farmer unrest in Maharashtra. However, the ongoing challenges have reignited anger.

Ajit Nawale, national joint secretary of the Akhil Bharatiya Kisan Sabha, criticised the government for inconsistent policies and alleged that its religious agenda has harmed India's credibility as an onion exporter. "Many Gulf countries, which are key importers, have stopped buying Indian onions. The unpredictable export-import policies, combined with rising inflation, climate change, and reduced yields, have worsened the situation, leading to double losses for farmers," he explained.

The current crisis underscores the urgent need for stable policies and decisive action to safeguard the livelihoods of India's onion farmers.